Preamble

The House being met, the Clerk at the Table informed the House of the unavoidable absence of Mr. SPEAKER from this day's Sitting.

Whereupon Sir DENNIS HERBERT, The CHAIRMAN OF WAYS AND MEANS, proceeded to the Table and, after Prayers, took the Chair as Deputy-Speaker, pursuant to the Standing Order.

PRIVATE BUSINESS.

PUBLIC WORKS FACILITIES SCHEME (THAMES CONSERVANCY RIVER IMPROVEMENT) BILL,

"to confirm a Scheme made by the Minister of Transport under the Public Works Facilities Act, 1930, relating to the Conservators of the River Thames," presented by Lieut.-Colonel Headlam; and ordered (under Section 1 (9) of the Act) to be considered To-morrow, and to be printed. [Bill 39.]

Oral Answers to Questions — UNEMPLOYMENT.

GRIGGLESTONE MINERS (APPEAL).

Mr. T. WILLIAMS: 1.
asked the Minister of Labour the reason for the delay from June to December in the hearing of the Grigglestone miners' appeal by the umpire; and whether such delays are due to shortage of staff?

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. R. S. Hudson): I understand the appeal in this case was received in October and not in June, as suggested by the hon. Member, and it is to be heard by the umpire to-day. In view of the necessity for further inquiries in the case, my right hon. Friend is satisfied that there has been no undue delay.

Mr. LUNN: Is the hon. Gentleman sure that there was no application made
before October, and is it not too long to keep cases waiting six months after the event?

Mr. HUDSON: The delay was not the fault of the Department. If there was any fault at all, it was that of the people concerned in not bringing the case before the Department.

Mr. LUNN: But what about the umpire? Is he too busy to deal with cases that come before him within six months?

Mr. HUDSON: It is not a question of six months. The appeal in this case was only received by the Department in October, so that the case has taken less than two months. In view of the difficulties of the case, involving a lot of detailed inquiries as to what happened, as to which men were employed and which were not, and so on, there has been no undue delay at all.

Mr. WILLIAMS: Was the original delay due to the mine workers who lodged an appeal or to the local Employment Exchange; and is it not the case that a particular length of time is allowed before an appeal is sent in?

Mr. PIKE: Does not the fault actually apply to the trade union responsible for looking after these men?

Mr. HUDSON: I should like notice of that question, but I understand that the fault is entirely due to the trade union concerned.

TRANSFERRED WORK (MOSSEND TO CORBY).

Mrs. SHAW: 2.
asked the Minister of Labour whether he has any information regarding the transfer of Messrs. Stewart and Lloyd's works from Mossend, Lanarkshire, to Corby, Northampton, and as to the number of workers who will be unemployed as the result of that transfer?

Mr. HUDSON: I understand that it is the intention of Messrs. Stewarts and Lloyds to close the greater part of their Mossend works at the end of this year, as part of a scheme under which products hitherto manufactured at those works will be produced at Messrs. David Colville's works at Clydebridge and the plant from the Mossend works will be transferred to new works which are being erected at Corby for the production of steel manufactures formerly imported
from abroad. As regards the employment position, I understand that approximately 900 workpeople who have been working intermittent short time at the Mossend works are likely to be affected; but, on the other hand, the workers in the Clyde-bridge area may be expected to benefit as a result of the transfer of work to that area. It is hoped that it may be possible for a proportion of the workers displaced from the Mossend works to obtain employment at Corby; a small number have already been transferred to that area. We are keeping in close touch with the position with a view to rendering all possible assistance in placing the displaced workpeople in further employment.

Mrs. SHAW: What facilities will the Ministry of Labour grant for the removal of these men and their families who will be transferred from the Mossend works to Corby?

Mr. HUDSON: Perhaps the hon. Lady will put that question on the Paper, and I shall be glad to give her an answer.

Mr. LAWSON: Did the hon. Member say it was hoped that it would be possible to give some of these men employment?

Mr. HUDSON: I said, "It is hoped that it may be possible for a proportion of the workers displaced. … to obtain employment," and that, we understand, is actually the hope, that we shall get a proportion of them transferred.

ITALY AND GERMANY.

Mr. LAWSON: 3 and 4.
asked the Minister of Labour (1) the number of workers in Italy and the number unemployed at the latest date;
(2) the number of workers and the number unemployed in Germany at the latest date?

Mr. HUDSON: As the reply is long, and contains a number of figures, I will, if I may, circulate it in the OFFICIAL REPORT.

Mr. RHYS DAVIES: In giving figures about unemployment in those countries, does the hon. Gentleman bear in mind that there is a different measurement of unemployment in them?

Mr. HUDSON: Yes, and I think that when the hon. Member reads the rather
long answer, he will find that due allowance has been made for that fact.

Following is the reply:

According to the census of the population taken on 21st April, 1931, the number of persons engaged in gainful occupations (including those unemployed) in Italy at that date was 17,131,281. This total includes 5,433,713 farmers under the various systems of land tenure in Italy; 2,475,949 agricultural wage-earners; 1,364,304 employers in industry and commerce; 724,697 persons working on their own account in occupations other than agriculture; 541,372 persons in the armed forces of the State; 533,295 persons classified under the heading "religion, the professions and the arts"; 5,132,381 manual workers; and 905,550 non-manual workers. The number of persons registered as unemployed at the Employment Exchanges in Italy at the end of October, 1933, was 962,868, including 215,373 persons normally employed in agriculture.

According to the census of the population taken on 16th June, 1925, the number of persons engaged in gainful occupations (including those unemployed) in Germany at that date was 32,009,300. This total includes 5,538,500 employers, persons working on their own account, directors, managers, senior public officials, military and naval officers, &c.; 5,274,232 non-manual workers (of whom 128,931 were employed in agriculture, 60,743 were in domestic service, &c., and 105,483 were non-commissioned officers and men in the army and navy); 14,433,754 manual workers (of whom 2,499,945 were employed in agriculture and 253,622 in domestic service); 5,437,227 family relatives assisting in the various enterprises; and 1,325,587 persons employed in domestic service and not classified under any of the foregoing headings. The number of persons registered as unemployed at the Employment Exchanges in Germany at the end of October, 1933, was 3,744,860. A small proportion of these persons (not yet exactly known) were agricultural workers and domestic servants.

Owing to differences in methods of compilation and of classification, as well as in the scope of these statistics, the figures quoted are not strictly comparable either as between the two countries named or as between these two countries and Great Britain.

ENTERTAINMENTS AND SPORTS.

Mr. HALL-CAINE: 5.
asked the Minister of Labour whether he will make inquiries as to the number of actors, actresses, musicians, and other theatrical employes now out of work and as to how this number has increased during the past live years; and whether, in future, he will arrange a separate category for such per

The statistics compiled by my Department show that the numbers of unemployed men and women on the registers of employment exchanges, who were applicants for work in the occupations named below, have been as follows:


Date.
Actor and actresses.
Musicians.
Other theatre, music hall and cinema employés


January, 1929*
…
…
570
843
1,324


October, 1929
…
…
923
1,481
1,298


October, 1930
…
…
1,825
3,417
2,452


October, 1931
…
…
2,662
4,451
3,491


October, 1932
…
…
1,823
3,304
3,252


October, 1933
…
…
1,849
2,974
3,737


Separate figures are not available for any date earlier that January, 1929.


In the statistics of unemployment in the various industries, published each month in the Ministry of Labour Gazette, these persons are included in the group "Entertainments and Sports." The industry classification includes, however, all insured persons, irrespective of occupation, employed by, or whose last employment prior to July of each year was with employers in the "Entertainments and Sports" group as a whole and it would not be practicable to compile separate statistics on this basis for the various occupations concerned.

Mr. HALL-CAINE: 6.
asked the Minister of Labour whether he is aware that, despite the general decrease in unemployment during the past 12 months, the percentage of persons unemployed in the entertainments group has risen from 24.3 to 24.6; and whether he will investigate to what extent this increased percentage is due to the closing of theatres or their conversion to cinemas, with a view to seeking a remedy of the matter?

Mr. HUDSON: The statistics of employment and unemployment among insured persons in the "Entertainments and Sports" classification show that at 23rd October, 1933, the percentage rate of unemployment among insured males in Great Britain was 23.3 as compared with 24.3 at 24th October, 1932. During the period of 12 months the number of insured males in employment in that group increased by about 6,600. In these circumstances my right hon. Friend does not propose to undertake the investigation suggested by my hon. Friend.

Mr. PIKE: Is the hon. Gentleman aware that much of this unemployment is
sons in the Ministry of Labour statistics in order that it may be possible to have an official record of unemployment in the British theatrical and musical industries?

Mr. HUDSON: As the reply includes a number of figures, I will, if I may, circulate a statement in the OFFICIAL REPORT.

Following is the statement:

due entirely to the imposition of the Entertainments Duty?

Mr. HUDSON: I have said that the number of insured Males in employment during the period mentioned has increased by 6,600.

SEASONAL WORKERS, BLACKPOOL.

Captain ERSKINE-BOLST: 7.
asked the Minister of Labour if, taking the figures of 1933 and 1932, respectively, he will state the number of seasonal workers in Blackpool who drew unemployment benefit in each on-season; what were the aggregate amounts of money they drew; what was the total of all seasonal workers in each period specified; and what was the aggregate of contributions to the funds in each period from such workers, their employers, and the State together?

Mr. HUDSON: I regret that the information desired is not available in respect of the 1932 on-season. An inquiry by sample into the benefit drawn by seasonal workers during the 1933 season is now proceeding, and I will communicate with my hon. and gallant Friend
when the results are available. I should add that the figures will relate to the whole country and not to any particular place.

UNEMPLOYMENT FUND.

Mr. MOLSON: 9.
asked the Minister of Labour how much of the existing debt of the Unemployment Insurance Fund was incurred otherwise than in the payment of standard benefit; and what is the total sum paid out since the institution of the fund otherwise than in standard benefit?

Mr. HUDSON: Separate accounts were not kept for standard benefit before 1929. In respect of the benefit years commencing after March, 1929, the accounts of the Unemployment Fund have shown separately the expenditure (including cost of administration) on transitional benefit and transitional payments; this expenditure has amounted to £141,000,000, up to the end of October, 1933, and has been wholly borne by the Exchequer.

GRIMSBY.

Mr. T. SMITH: 12.
asked the Minister of Labour whether he is aware that at Grimsby, where a new fish dock is being constructed and other works are in progress, local unemployed men have been refused green cards at the Exchange and preference given to unemployed men who have come in from other areas; and whether he will have inquiries made into the matter?

Mr. HUDSON: My right hon. Friend is having inquiry made and will communicate with the hon. Member as soon as possible.

TRAINEES.

Mr. PIKE: 13.
asked the Minister of Labour if, in order to ensure the maximum absorption into specific industries for which they have been trained under the Unemployment Bill, His Majesty's Government will so amend the Trade Disputes Act, 1927, as to preclude the trade unions refusing to permit trainees to accept employment in such appropriate industry?

Mr. HUDSON: I am afraid my hon. Friend's suggestion is neither necessary nor practicable.

Mr. PIKE: Will my hon. Friend bear in mind that in 1924, after the State had spent some £150,000 on the training of
ex-service men in the building trades, the trade unions refused to accept them for that specific purpose, and will the Government take precautions against a recurrence of such action?

Mr. HUDSON: I do not as a rule find myself in agreement with the objections which are from time to time raised by trade unions in this connection, but we must recognise that they have a point of view that they are entitled to put, and I think it is much better dealt with by methods of discussion than by any attempt at statutory regulations.

Mr. PIKE: Will the Government assure the House that such discussions will take place, in order to avoid a recurrence of these things?

Mr. HUDSON: They are continually taking place.

NON-MANUAL WORKERS (INSURANCE).

Miss RATH BONE: 14.
asked the Minister of Labour what would be the estimated cost of bringing within unemployment insurance insured persons, not belonging to excluded occupations, with incomes between £250 and £350, or £250 and £500, respectively?

Mr. GRAHAM WHITE: 10.
asked the Minister of Labour if lie has made any estimate of the financial consequences of including non-manual workers up to an income limit of £350 in the unemployment insurance scheme on the basis of present contributions and benefits?

Mr. HUDSON: Information is not avilable on which to make any reliable estimate of the financial consequences of including non-manual workers up to an income limit of £350 or £500 in the unemployment insurance scheme. I would, however, refer the hon. Members to paragraphs 341 and 342 of the Report of the Royal Commission on Unemployment Insurance, which contain some observations on the subject, including an estimate of the increased income, but not of the increased expenditure, which would arise if this income limit were raised to £500.

UNEMPLOYMENT BILL.

Miss RATH BONE: 15.
asked the Minister of Labour whether he will estimate the cost of extending to all unemployed persons without limit of income, provided that they are normally in full-
time employment, the right of applying to and receiving assistance from the unemployment assistance board proposed to be set up under the Unemployment Bill?

Mr. HUDSON: As there is no information available as to the extent of unemployment among, or the resources available to, the persons covered by the question, I regret that it is not possible to give any estimate of the cost of any such extension.

Miss RATHBONE: Does the hon. Member think it fair that genuinely unemployed persons should be debarred from all right of applying for unemployment assistance except through the Poor Law?

Mr. DEPUTY-SPEAKER: That is a totally different question.

Oral Answers to Questions — ALIENS (DOMESTIC SERVANTS).

Mr. D. G. SOMERVILLE: 11.
asked the Minister of Labour whether he is aware of the practice by which employers can obtain in this country German and other foreign domestic servants who are already in this country without any formality other than notifying the police that they have engaged them; and whether he will take steps to ensure that those foreign domestic servants who obtain permits to enter this country for employment with a particular employer are obliged to leave the country immediately that employment is completed?

Mr. HUDSON: The question of applying further control in respect of changes of employment by foreign domestic servants admitted under permit has been carefully considered by my right hon. Friend's Department and the Home Office, but it has not been thought that the considerable administrative expense involved would be justified.

Mr. SOMERVILLE: Does not this procedure enable an alien coming into this country to remain here indefinitely, instead of having to return at the expiration of the employment on which he was engaged and for which he was brought to this country?

Mr. HUDSON: My hon. Friend will remember that I said, in answer, I think, to a question by him a short time ago,
that the average length of stay of these foreigners was something under two years.

Oral Answers to Questions — JUVENILE EMPLOYMENT.

Mr. RHYS DAVIES: 16.
asked the Secretary of State for the Home Department when the Bill to cover the conditions of young persons in unregulated trades will be introduced?

The SECRETARY of STATE for the HOME DEPARTMENT (Sir John Gilmour): I assume that the hon. Member refers to the projected Bill to regulate further the hours of young persons employed in the distributive trades. I hope to be in a position to introduce this Bill early in the New Year.

Oral Answers to Questions — LOTTERIES AND BETTING.

Sir PARK GOFF: 17.
asked the Home Secretary whether, in view of the decision of the Government to discountenance such lotteries and sweepstakes as are regarded in law as gambling transactions, he will include in any contemplated legislation arising out of the Betting Report a provision to withdraw recognition in law from debts arising from margin accounts on stack exchange speculations for the rise and fall in quoted securities?

Sir J. GILMOUR: The Government have not yet taken any decision on the questions relating to lotteries and betting which have been engaging their attention, and I cannot attempt to forecast the provisions of the Bill which I hope to introduce soon after the Recess.

Sir P. GOFF: Is my right hon. Friend aware that the amount of money turned over on Stock Exchange gambling is far greater than the amount risked in lotteries and sweepstakes?

Oral Answers to Questions — METROPOLITAN POLICE COLLEGE.

Mr. COCKS: 18.
asked the Home Secretary why the Commissioner of Police has issued instructions stating that candidates who secure entry into the new Metropolitan Police College must provide themselves with a dinner-jacket suit, four dress shirts, and patent shoes?

Sir J. GILMOUR: It is quite customary to notify those entering an establishment like the Police College of the outfit which they will need when there.

Mr. COCKS: Does that mean that the Government have modified their policy and have no intention of creating an officer class in the police force, or does it mean that they think that criminals in future will be confined to the upper classes?

Mr. HERBERT WILLIAMS: Is there any reason why waiters should be better dressed than policemen?

Mr. RHYS DAVIES: Does the right hon. Gentleman admit the suggestion in the question that these men must have four dress shirts each?

Sir PERCY HARRIS: Does the right hon. Gentleman realise that this will tend to increase the old civilian traditions of this force and inculcate in their superior officers ideas of snobbery?

Mr. COCKS: 19.
asked the Home Secretary why candidates for the new Metropolitan Police College, taking the examination in modern history, are required to pay special attention, amongst other matters, to Frederick the Great and the rise of Prussia, Bismarck and the union of Germany, and the ambitions of Louis XIV?

Sir J. GILMOUR: The syllabus for the examination for entry to the Metropolitan Police College was determined in consultation with the Civil Service Commissioners. The syllabus selected is the same as that prescribed for the Indian Police Service. It is one with which secondary schools are familiar and the subjects mentioned in the question are included with others as items designed to test the candidate's knowledge of European history in its relation to British history.

Mr. COCKS: Does that mean that the Government wish to inculcate the spirit of Prussianism in the police force; if not, will the right hon. Gentleman consider substituting the execution of Charles I, the downfall of the Kaiser, and the rise of English liberty?

Mr. ANSTRUTHER-GRAY: Is it not a fact that these particular subjects are optional?

Mr. COCKS: Is the right hon. Gentleman making arrangements to allow instruction to be given in these subjects by Herr Hitler's agents in London?

Oral Answers to Questions — PRISONS.

Mr. D. G. SOMERVILLE: 21.
asked the Home Secretary whether he can make any further report to the House on the conditions obtaining in Dartmoor and the other convict prisons since the distribution of prisoners from Dartmoor, following upon the fire, to other gaols in the country?

Sir J. GILMOUR: Of the four convict prisons, two received none of the prisoners transferred from Dartmoor. These two are Maidstone, which takes star class convicts, i.e., those who, though convicted of one serious crime, are not of criminal habits, and Chelmsford, which takes young men who have started on a career of crime and are serving a first sentence of penal servitule. At Chelmsford 12 months ago certain prisoners caused disturbance by shouting, but suitable disciplinary methods were taken and there has been no recurrence. At Parkhurst there was last July an abortive attempt by five convicts to effect an escape, about which I gave the House information at the time. Apart from this nothing has occurred at Dartmoor or Parkhurst calling for special comment.

Oral Answers to Questions — ESCAPED TIGER, SHEFFIELD.

Mr. LOUIS SMITH: 22.
asked the Home Secretary whether his attention has been called to the attack on Ernest George Dalton by an escaped tiger in a theatre at Sheffield; whether he will state the number of similar occurrences by circus and menagerie animals during the past five years; and whether any legislation to stop such occurrences is proposed?

Sir J. GILMOUR: I have seen a newspaper report of this case, and am causing further inquiries to be made.

Mr. SMITH: Will the right hon. Gentleman carefully go into this matter, as the escape of this tiger has caused mental suffering to many citizens of Sheffield, even more severe than that which the whole country would experience
if the policy of the hon. and learned Gentleman the Member for East Bristol (Sir S. Cripps) were adopted?

Oral Answers to Questions — EDUCATION.

BLACK-LISTED SCHOOLS.

Mr. ISAAC FOOT: 23.
asked the Parliamentary Secretary to the Board of Education the number of provided and non-provided schools the premises of which have been condemned by the Board and placed in division A of the black list as being unsuitable for continued recognition and incapable of improvement; and if the list of such schools can be furnished by a White Paper, or otherwise, showing the date when each school was black-listed?

The PARLIAMENTARY SECRETARY to the BOARD of EDUCATION (Mr. Ramsbotham): The numbers of provided and of non-provided schools still included in Class A of the Black List, which was drawn up in 1925 and 1926, are respectively 77 and 138. As every local education authority has been furnished with a list of the schools in its own area, my Noble Friend sees no reason for the publication of a return in the form of a White Paper; but he is sending the hon. Member a list of the schools still included in Class A of the Black List.

Mr. FOOT: In view of the fact that the list has not been published for a great many years, and that it would be an excellent expenditure to make the schools adequate for our children, cannot the list be published for the general convenience?

Mr. RAMSBOTHAM: As the authorities have their own lists, it is hardly necessary to publish it as a White Paper.

Mr. ANNESLEY SOMERVILLE: Is it not a fact that the number of such schools is continually diminishing?

Mr. RAMSBOTHAM: That is the fact.

ELLEN STREET SCHOOL, HOVE.

Mr. MALLALIEU: 24.
asked the Parliamentary Secretary to the Board of Education whether he has considered the proposal of the Hove Education Committee to convert the Ellen Street provided school into a non-provided school; and whether, before sanctioning the grant
of a long lease of the Ellen Street school to the managers of the George Street Church of England school, he will ensure that the rights of appointment of, and control over, the teaching staff will be retained by the local authority?

Mr. RAMSBOTHAM: Proposals in this matter have been submitted to the Board, but my Noble Friend is not in a position to give any decision upon them until the requirements of Section 18 of the Education Act, 1921, have been satisfied. He understands that notices of the proposal have been published as required by that Section, but that the statutory period of publication has not yet expired. It would obviously be improper for my Noble Friend to prejudge any of the issues involved until the publication period has expired and the case comes before the Board for formal determination.

TECHNICAL EDUCATION (DISTRESSED AREAS).

Mr. CHORLTON: 25.
asked the Parliamentary Secretary to the Board of Education if he will give details of the increase in technical education facilities contemplated in those districts where unemployment is greatest?

Mr. RAMSBOTHAM: It is not contemplated that any increase in the facilities for technical education should be specially related to districts where unemployment is greatest, since I have no reason to think that existing facilities are, generally speaking, inadequate, but I shall of course be glad to receive from my hon. Friend any definite suggestions that he has to make. The Government's proposals for instruction and training for the unemployed, both juveniles and adults, are contained in the Unemployment Bill. The Board of Education will co-operate in helping to secure the provision of such instruction and training.

SLUM-CLEARANCE SCHEMES.

Mr. CHORLTON: 26.
asked the Parliamentary Secretary to the Board of Education what steps he proposes to take, in places where slum-clearance schemes are resulting in movements of population, to provide transport from the new areas to which the population has moved to the schools formerly attended by the children concerned, or to provide other assistance to these schools?

Mr. RAMSBOTHAM: The question of the necessity or desirability of making arrangements for the transport of school children from one district to another is one for the consideration of the local education authority in the light of the particular local circumstances. My Noble Friend is not clear to what the last part of the question refers, but he would remind my hon. Friend that a school which is recognised by the Board of Education as a public elementary school must continue to be maintained by the local education authority so long as it is necessary and fulfils the requirements of the Education Acts and of the Code.

Mr. CHORLTON: Does the hon. Gentleman realise that in slum clearance schemes denominational children go into another area where a school does not exist, so that schools will have to be provided for them?

Mr. RAMSBOTHAM: As my hon. Friend is aware, the Board of Education have no power to give financial assistance for the building of non-provided schools.

SCHOOL OF ART, ABERDEEN (DIPLOMA).

Mr. BURNETT: 27.
asked the Parliamentary Secretary to the Board of Education whether representatives of the National Society of Arts Masters have visited the School of Art in Aberdeen with a view to the recognition of its diploma in England on terms similar to those accorded to the Edinburgh College of Art?

Mr. RAMSBOTHAM: My Noble Friend is not aware of this visit. He assumes that my hon. Friend refers to the treatment of diplomas in art as equivalent to university degrees in connection with the calculation of the salaries of teachers under the Burnham Scales. This is a, matter for the consideration of the Burnham Committee.

Mr. BURNETT: Will my hon. Friend make representations to the Burnham Committee with a view to ascertaining whether the standard in Aberdeen is in any way inferior to other courses?

Mr. CHARLES WILLIAMS: Will my hon. Friend inform the Committee that we have enough Scotsmen already?

Mr. RAMSBOTHAM: I shall, of course, be ready to pass on to the Committee any representations that may be made to me on the matter, hut I cannot undertake to attempt to influence the Committee's decision.

Oral Answers to Questions — HOUSING.

STATISTICS.

Dr. HOWITT: 28.
asked the Minister of Health the estimated number of houses in England and Wales at the present time per 1,000 of the population and, for comparison, the corresponding figure in 1929 and in 1913, respectively?

The MINISTER of HEALTH (Sir Hilton Young): The estimated numbers are 245.8, 230.8 and 215.6.

Mr. GODFREY NICHOLSON: What does the right hon. Gentleman consider to be the ideal to be aimed at?

Major NATHAN: 31.
asked the Minister of Health how many houses have been completed by Iota: authorities without State assistance in the administrative county of London, and in the rest of England and Wales, respectively, during the half-years ended 31st March, 1932, 30th September, 1932, 31st March, 1933, and 30th September, 1933, respectively?

Sir H. YOUNG: As the answer involves a number of figures, I will, with the hon. Member's permission, circulate it in the OFFICIAL REPORT.

Major NATHAN: May I ask whether the curve shown by those figures is in an upward or downward direction?

Sir H. YOUNG: I should be sorry to deduce the curve of a sudden in this House. Perhaps the hon. and gallant Member will be as well able to do it as I am when he gets the table.

Mr. H. WILLIAMS: Does the table include houses built outside the administrative County of London by authorities inside the administrative county?

Sir H. YOUNG: The table gives in the first column information of the administrative County of London, and in the second column of England and Wales.

Following is the answer:

The following statement shows the desired particulars:


Half-year ended—
Administrative County of London.
Rest of England and Wales.


31st March, 1932
196
1,170


30th September, 1932
96
594


31st March, 1933
192
543


30th September, 1933
33
468

HOUSES (DIMENSIONS).

Major NATHAN: 32.
asked the Minister of Health whether he can state the superficial area of the 240 houses now being erected at Aldershot by private enterprise under the Housing (Financial Provisions) Act, 1933, and the average superficial area of non-parlour houses provided by local authorities in England and Wales during the period January to October, 1933, respectively; and what steps he has taken or will take to ensure that all houses erected by private builders in the Greater London region under the Housing Act, 1933, are of a proper standard for the working classes?

Sir H. YOUNG: I am informed that the superficial area of the houses mentioned by the hon. Member is 662 square feet in some cases and 653 in others. The average area of houses provided by local authorities during the period mentioned is 728 feet. The minimum dimensions of houses erected under the Housing (Financial Provisions) Act, 1933, are governed by Section 92 of the Housing Act, 1925, of which Section 2 of the 1933 Act is an extension.

Major NATHAN: Does the right hon. Gentleman consider that the dimensions which he has given are a satisfactory result of the legislation which we have passed?

Sir H. YOUNG: I think the hon. and gallant Member is under a misapprehension. I must point out that the dimensions are respectively 42 and 33 square feet in excess of the minimum dimensions laid down for my guidance by Parliament.

LOANS (INTEREST).

Major NATHAN: 38.
asked the Financial Secretary to the Treasury what is the minimum rate of interest at
the present time on advances made by the Public Works Loan Board to local authorities for the purposes of housing and slum clearance; and when the last reduction was made?

The FINANCIAL SECRETARY to the TREASURY (Mr. HORE-BELISHA): These advances are made at the minimum current rate for loans from the Local Loans Fund, which was reduced from 4 per cent. 3⅝ per cent. on the 11th April last.

Major NATHAN: May I ask whether it is proposed to make any further reduction, and when, in view of the glut of money awaiting employment.

Mr. HORE-BELISHA: Only when the situation permits.

Oral Answers to Questions — PUBLIC ASSISTANCE, SOUTH YORKSHIRE (SURCHARGE).

Mr. T. SMITH: 29.
asked the Minister of Health if he is aware that certain members of public assistance committees in South Yorkshire have been surcharged for various sums as a result of carrying out their duties; that no specific instructions were laid down as to the exact amount of relief that should be given in each case; and whether he will take steps to remit surcharges in these and all similar cases?

Sir H. YOUNG: I am aware of surcharges made on members of certain guardians committees in the West Riding of Yorkshire. As the hon. Member is no doubt aware, the surcharges were in respect of relief which either was granted where there was no destitution or was excessive and unreasonable in amount. In the present instance I had no hesitation in confirming the surcharges made by the district auditor, but felt justified in remitting a portion of the sums surcharged. I could not properly make any statement as to my action in respect of future surcharges.

Mr. T. WILLIAMS: Is not the right hon. Gentleman aware that some of the members who were surcharged were unemployed at the time and are unemployed now; and as there were no definite instructions as to how relief should be applied in specific cases, does he not think that in the case of unemployed men this surcharge ought not to be made?

Sir H. YOUNG: The hon. Member can rest assured that all relevant considerations were taken into account by me in the discharge of my duty under the Statute.

Mr. WILLIAMS: But is the right hon. Gentleman aware that some of these local representatives are unemployed, and are quite unable to provide this surcharge, and will he not reconsider the whole question in that light?

Sir H. YOUNG: Careful consideration was given to this matter before I arrived at a decision, and I do not see any reason for altering that decision.

Lieut.-Colonel ACLAND-TROYTE: Does not this Show that the high rates in distressed areas are due to incompetence and extravagance in those areas, and will the right hon. Gentleman remember this when he looks into the matter in future?

Oral Answers to Questions — RURAL WATER SUPPLIES (GOVERNMENT GRANT).

Mr. HALL-CAINE: 30.
asked the Minister of Health if he can give any indication as to the conditions which will qualify local authorities to apply for assistance from the Government grant set aside for the improvement of rural water supplies?

Sir H. YOUNG: A Bill to authorise the grant will be introduced shortly. It is intended that grants will be made in aid of approved schemes of rural water supply where the cost, after allowing for fair contributions from county councils and rural district councils and the income from proper charges on water consumers, would involve a deficiency rate on the parish greater than the parish could reasonably be expected to bear.

Mr. T. WILLIAMS: Will the landowners who will benefit through this £1,000,000 scheme make any contribution to the cost?

Mr. D. G. SOMERVILLE: Can the right hon. Gentleman say what percentage of grant will be given in these cases?

Sir H. YOUNG: As regards particulars of the scheme, probably it would be better to await the actual provisions of the Bill.

Mr. WILLIAMS: May I have a reply to my question? Will the right hon. Gentleman say whether any of the landowners in the respective areas are making any contribution, and what surcharge is being made upon them?

Sir H. YOUNG: It appears to me the hon. Member's question is merely a matter for argument on the Bill.

Oral Answers to Questions — RATING RELIEF.

Mr. McGOVERN: 33.
asked the Chancellor of the Exchequer the amount of money refunded, for England and Scotland, respectively, under the De-rating Act for each year since the Act was passed?

The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain): I assume that the hon. Member refers to the extent to which the occupiers of certain hereditaments were relieved of rates under the de-rating provisions of the Local Government Acts, 1929. The total rate reductions due to these provisions is, on the basis of the standard year (1928–29), about £22,340,000 for England and Wales and about;£3,340,000 for Scotland. Similar information is not available for later years, but I have no reason to suppose that the amount of relief has varried substantially.

Mr. McGOVERN: Will the right hon. Gentleman consider the question of taking a portion of the money which is not required and allocating it to the abolition of the means test and restoring the cuts in unemployment benefit?

Mr. CHAMBERLAIN: I am not aware that any of this money is not required.

Mr. McGOVERN: is it not the case that money is being given to large tobacco and whiskey firms who do not require it, and that the working classes could do with it instead?

Oral Answers to Questions — UNITED STATES (BRITISH DEBT).

Mr. D. G. SOMERVILLE: 34.
asked the Chancellor of the Exchequer if he can make any further statement as to the position of the American debt payment?

Mr. CHAMBERLAIN: The answer is in the negative.

Sir ASSHETON POWNALL: Has not the right hon. Gentleman's attention been called to the fact that Italy is making a token payment to the United States, and will he not inform the Italian Government that such a token payment would not be refused by us?

Mr. D. G. SOMERVILLE: Can the right hon. Gentleman say when the figures will be given or a statement be made as regards this token payment

Mr. CHAMBERLAIN: A statement was made about the token payment. It was made last month.

Oral Answers to Questions — TRADE AND COMMERCE.

IMPORT DUTIES (COMPROMISE FINES).

Mr. LEVY: 35.
asked the Chancellor of the Exchequer the total amount of fines collected by the customs authorities in compromised cases of evasion of import duties for the past 12 months; and whether he is prepared in future to arrange for the publication of details of such cases with a view to diminishing the number of instances in which the payment of customs duty is evaded?

Mr. CHAMBERLAIN: The total amount of compromise fines collected in the year ended 31st October, 1933, in tespect of offences of all kinds against the customs laws relating to imported goods was approximately £109,000. I fear that I cannot accept my hon. Friend's suggestion as to publication; the great majority of these cases are of a petty nature and I doubt whether the object he has in mind would be served thereby. In serious cases the normal rule is to take proceedings in the courts.

Mr. L. SMITH: Is the right hon. Gentleman aware that a change over of the duties from ad valorem duties to specific duties will assist the Exchequer very much in regard to these evasions in many instances?

Mr. CHAMBERLAIN: I will consider that point.

CARRIAGE OF IMPORTS (BRITISH SHIPS).

Mr. ANSTRUTHER-GRAY: 52 and 53.
asked the President of the Board of Trade (1) what percentage of goods, in tons, imported into Britain from foreign countries during the past 12 months was carried in British bottoms;
(2) what percentage of goods, in tons, imported into Britain from the Empire during the past 12 months was carried in British bottoms?

The PRESIDENT of the BOARD of TRADE (Mr. Runciman): I regret that the desired information is not available.

Mr. ANSTRUTHER-GRAY: May I ask what steps the Government are taking to increase the quantities of imports that are carried by British as opposed to foreign ships?

Mr. RUNCIMAN: Perhaps I had better answer my hon. Friend's question in a. different form. During the year 1932, of the net tonnage of vessels that entered with cargo at ports in the United Kingdom from the Empire, the proportion of British vessels was 92 per cent. The British proportion of such tonnage from foreign countries was 49.7 per cent.

RUSSIA.

Mr. MABANE: 54
asked the President of the Board of Trade (1) whether he can yet make any announcement with regard to the Anglo-Soviet Trade Agreement;
(2) whether he can assure the House that the conclusion of the Anglo-Soviet Trade Agreement will not be made dependent upon the settlement of debts due by the Union of Socialist Soviet Republics to private individuals or companies;
(3) the Secretary of State for Foreign Affairs whether he has any information to show that the Government of the Union of Socialist Soviet Republics are prepared to enter into direct negotiations with the officials of the Lena Goldfields Company in order to reach a settlement of the financial dispute between that company and the Government of the Union of Socialist Soviet Republics?

Mr. RUNCIMAN: The negotiations for a new trade agreement are still proceeding, and progress has been made. I cannot make any further statement at this stage. As regards questions which, though not directly forming part of the trade negotiations, have been the subject of discussion during those negotiations, I cannot say more at this moment than that those matters are engaging the close attention of His Majesty's Government.

Mr. LANSBURY: Are the difficulties that have to be overcome connected specifically with trade, or with other extraneous matters?

Mr. HANNON: Before the President of the Board of Trade replies, may I ask whether he is taking into account the visible balance of trade between the two countries in these negotiations?

Mr. RUNCIMAN: Oh, yes; I can tell my hon. Friend that, of course, that is being taken into account, and I hope it will be provided for. In reply to the question of the right hon. Gentleman the Leader of the Opposition, the trade agreement is concerned with trade.

UNITED STATES (LIQUOR IMPORTS).

Mr. HANNON: 61.
asked the Secretary of State for Foreign Affairs the general provisions of the liquor marketing agreement which became operative on the 5th December between this country and the United States; if any quota has been fixed for the import of liquor into the United States from this country or other countries in the British Commonwealth; and if any proposals for reciprocal agreements relating to American imports to Great Britain have been received by His Majesty's Government?

The UNDER-SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Eden): No such agreement as my hon. Friend describes is in existence. The effective total quota for the United Kingdom has not yet been determined. I understand that certain proposals covering the transitional period from the 6th December to the 31st January next are now under consideration, and that it is possible that during that period a quantity equivalent to four months' supplies of the minimum annual quotas will be admitted at once in any event, but conversations on the subject are still proceeding with the United States Government, and it is not at present possible to give figures.

Mr. HANNON: Can my hon. Friend say when I may put down a question in the future, so that I may get a definite answer on the points embodied in this question?

Mr. EDEN: Perhaps my hon. Friend will allow me to communicate with him when our conversations are completed.

Mr. HANNON: Thank you.

Oral Answers to Questions — GOVERNMENT DEPARTMENTS (EX-SERVICE MEN).

Lieut.-Colonel ACLAND-TROYTE: 36.
asked the Financial Secretary to the Treasury whether he will arrange for the creation of a special register of temporary ex-service men already discharged for redundancy, many of them after many years of temporary service, in order that they may be considered for re-appointment as opportunity occurs

Mr. HORE-BELISHA: I would refer my hon. and gallant Friend to the answer given to the hon. and gallant Member for Wycombe (Sir A. Knox) on the 15th December last and to paragraph 13 of the Report of the Temporary Staffs Committee, of which I am sending him copies. It should be added that temporary employes of Government Departments discharged on redundancy may register with the Employment Exchanges and are then considered as vacancies arise for further employment in accordance with the usual machinery.

Lieut.-Colonel ACLAND-TROYTE: Yes, but would not lot be much better to keep a register of these men, so that they can be given employment as the chance arises? Do the Government not wish to give them employment?

Mr. HORE-BELISHA: Yes, but to put them on a special register would, as I am sure my hon. and gallant Friend will appreciate, create expectations in their minds which might not always be fulfilled.

Lieut.-Colonel ACLAND-TROYTE: Would it not be better to create expectations than not to give them employment?

Lieut.-Colonel ACLAND-TROYTE: 37.
asked the Financial Secretary to the Treasury if he will give an assurance that the promotion prospects of ex-service men serving as members of the new special class shall not be in any way prejudiced by the absorption of recruits from open competition or by the promotion of female personnel already employed in the Civil Service; and whether he will undertake that no temporary ex-service man shall be displaced, either directly or indirectly, by the introduction of new recruits from outside?

Mr. HORE-BELISHA: As regards the first part of the question, it was agreed when the special class was constituted following the report of the Temporary Staffs Committee that members thereof should be eligible on their merits for promotion to the general or departmental clerical classes. My hon. and gallant Friend may rest assured that this arrangement will operate. As regards the second part of the question, I would refer to the answer given to the hon. and gallant Member for Wycombe (Sir A. Knox) on the 14th December, 1932, of which I am sending him a copy.

Oral Answers to Questions — TITHE RENTCHAR GE.

Mr. ISAAC FOOT: 39.
asked the Minister of Agriculture if he is now in a position to state whether the Government intend to make any proposals in respect of tithe?

The MINISTER of AGRICULTURE (Mr. Elliot): I am not at present in a position to make a statement on this subject.

Mr. FOOT: Having regard to the general anxiety prevailing, can some indication be given as to when proposals will be submitted to the House?

Mr. ELLIOT: I am afraid I could not give any promise that proposals will be submitted to the House.

Oral Answers to Questions — AGRICULTURE.

MILK MARKETING SCHEME.

Sir PERCY HURD: 40.
asked the Minister of Agriculture if he will state what steps he is taking to safeguard the operation of the milk marketing scheme, in view of the prospect that in the early summer about one-half of the milk output of this country will have to be sold at manufacturing prices with serious loss to the producers; and whether the Government will now announce their intention to restrict imports sufficiently to restore a remunerative price for butter, cheese, and other milk products manufactured in this country?

Mr. ELLIOT: As regards imports of butter and cheese, I am not in a position to add to the replies which I gave on 27th November.
As regards imports of other processed milks, my hon. Friend will be aware that such imports have been regulated by voluntary agreement since June last. Proposals for regulation during the first quarter of next year are being communicated to the exporting countries concerned and the Markets Supply Committee will in due course be asked to advise as to the steps which ought in their opinion to be taken to regulate imports of those products after March next.

Sir P. HURD: Is the right hon. Gentleman fully informed of the seriousness with which the Marketing Board regards the position that will arise next spring; and, in view of the necessity of planning ahead in the industry, can he intimate that some early announcement will be made of the Government's intentions?

Mr. ELLIOT: Yes, Sir, I am fully aware of the seriousness with which the Milk Board regards the question, and I had an opportunity of discussing it personally with them before meeting members of this House.

Sir P. HURD: May we expect an early announcement?

Mr. COCKS: Will the right hon. Gentleman tell us how long it will be before we can get a really good prospect of scarcity?

Mr. ELLIOT: The question of avoiding a scarcity is a question of avoiding the collapse of the milk market, which would cause a scarcity of liquid milk.

Mr. H. WILLIAMS: Will the right hon. Gentleman consider the prohibition of the importation of skimmed condensed milk, the consumption of which is prohibited in practically every civilised country, except our own?

Mr. ELLIOT: I have given in my answer an indication that we are dealing with that question of condensed skimmed milk, but I would point out that there is a large manufacture of it in this country, which I desire to see extended, and therefore I would be opposed to prohibiting it.

WHEAT DEFICIENCY PAYMENT.

Mr. TEMPLE MORRIS: 41.
asked the Minister of Agriculture whether he is aware that certain patent breakfast foods,
of which wheat forms the chief component part, do not contribute to the wheat quota on the same basis as bread, on which purchasers have to pay approximately ½d. tax on each loaf of bread; and if he will take steps to rectify this state of affairs?

Mr. ELLIOT: I should explain to my hon. Friend that the quota payment under the Wheat Act, 1932, is not levied upon wheat but upon flour, as defined in the Act, whether the flour is used in bread making, or is used in the manufacture of patent breakfast foods, or for any other purpose.

The amounts advanced to date are as follow:—

Name of Marketing Board.
Amount Advanced—


From the Agricultural Marketing Fund.
From the Agricultural Marketing (Scotland) Fund.
Total.




£
£
£


Hops Marketing Board
…
500
—
500*


Pigs Marketing Board
…
4,500
500
5,000


Pigs Marketing Board
…
3,870
430
4,300


Scottish Raspberry Marketing Board
…
—
200
200


Scottish Milk Marketing Board
…
—
1,500
1,500*


Milk Marketing Board
…
8,500
—
8,500*


Milk Marketing Board
…
13,750
—
13,750*


Total
…
31,120
2,630
33,750


*loan has been repaid.

Oral Answers to Questions — SCOTLAND.

LICENSING ACTS.

Mr. McGOVERN: 43.
asked the Secretary of State for Scotland if he is prepared to bring in legislation with a view to placing the power to grant licences in the hands of the sheriff, in view of the conviction on a charge of bribery of two magistrates at Ayr High Court and recent events in Glasgow?

The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Skelton): I would refer the hon. Member to the reply which he received from my right hon. Friend yesterday, on the subject of legislation to amend the Licensing (Scotland) Acts.

Mr. McGOVERN: May I ask the hon. Gentleman if his attention has been drawn to the fact that those two magistrates in Ayr, and the Provost of the

Sir P. HARRIS: Does the Minister of Agriculture now admit that the result of the quota has been an increase of ½d. on the loaf?

AGRICULTURAL MARKETING BOARDS.

Mr. T. WILLIAMS: 42.
asked the Minister of Agriculture how much money has been advanced to agricultural marketing boards under Section 13 of the Agricultural Marketing Act, 1931, to the latest date, stating the amount advanced to each board separately?

Mr. ELLIOT: As the reply contains a number of figures, I will, if I may, circulate it in the OFFICIAL REPORT.

Following is the reply:

area, all met in licensed premises on a Sunday night, to discuss the granting of a licence, that the barman of that public-house was sitting on the magisterial bench, that the Provost was arrested yesterday, and that in Glasgow they are openly demanding money to vote for licences; and will he say whether that is not a serious state of affairs demanding action? May I ask the hon. Gentleman for a reply?

Mr. SKELTON: The reply is so obvious. I have nothing to add to what I have already said, and my right hon. Friend said yesterday that he is unable to give any undertaking as to such legislation. Any reply to the facts given seems superfluous.

Mr. McGOVERN: Will the hon. Gentleman draw the attention of the Secretary of State for Scotland to the
fact that there is a growing demand in Scotland that the licensing law should be amended, in order to stop the graft that is going on?

Mr. SKELTON: Yes, Sir, certainly.

POOR RELIEF.

Mr. McGOVERN: 44.
asked the Secretary of State-for Scotland if he is aware that the Govan Parish Council during 1930 paid an additional is. 6d. to the children of able-bodied persons drawing relief, making 3s. 6d. per week for each child; if he can state the cost of the same; and whether any surcharge was made upon the members of the local authority because of that decision?

Mr. SKELTON: I am aware that, at the end of March, 1930, Govan Parish Council resolved that the aliment paid to dependent children, under 16 years of age, of able-bodied unemployed persons in receipt of relief, be increased by la. 6d. per week. The additional allowance appears to have been paid for a period of four weeks until 15th May, 1930, when, in terms of the Local Government (Scotland) Act, 1929, the functions of the parish council were transferred to the Town Council of Glasgow and the payment of the additional allowance ceased. As regards the second part of the question, information as to the cost to the parish council of the additional allowance is not now available. As regards the last part, the expenditure not having been challenged by the auditor, the question of surcharge did not arise.

Mr. McGOVERN: Seeing that there was no surcharge and that therefore we must take it that the decision was legal, can the hon. Gentleman state why the Scottish Office prohibited the Glasgow Corporation last December from paying Is. ed. extra to each child for the Christmas and New Year period?

Mr. SKELTON: That supplementary question raises a number of topics quite outside the original question, and will have to be put down separately.

Mr. TINKER (for Mr. KIRK-WOOD): 48.
asked the Secretary of State for Scotland what was the amount expended by the county of Dunbarton and the burghs of Dumbarton and Clydebank on able-bodied relief for the unemployed for the year ended May, 1933; and what will
be the financial relief afforded to those areas by the Unemployment Bill now before Parliament?

Mr. SKELTON: The amounts expended during the year in question by the County Council of Dunbarton, and the Town Councils of Dumbarton and Clydebank on the relief of the able-bodied poor were £23,842, £13,297 and £38,241, respectively. I regret that it is not yet possible to estimate the financial relief which will be afforded to individual authorities.

FISHERY BOARD VESSELS.

Mr. NEIL MACLEAN:: 45 and 47.
asked the Secretary of State for Scotland (1) whether he is aware that the "Freya," one of the vessels under the superintendence of the Fishery Board of Scotland, has to sail from the Moray Firth to Leith every three weeks for coaling, and is absent from its cruising area during those periods from eight to ten days; whether any other vessel takes her place during those absences; and whether, with a view to greater efficiency and better supervision of the Moray Firth, he will take steps to ensure that the "Freya "coals at one of the harbours on the Moray Firth? and
(2) whether he is aware that the "Minna," one of the vessels under the superintendence of the Fishery Board of Scotland, which operates in the fishing waters round Lewis and Skye, has to go to Greenock for re-coaling; whether any other vessel of the Board performs her duties during the periods of absence for re-coaling; and whether he will arrange for the "Minna" to be refueled at a harbour nearer to her sphere of operation?

Mr. SKELTON: Leith and Greenock are the normal coaling ports of the cruisers "Freya" and "Minna" respectively, but, when necessary, the cruisers coal at local ports; when either cruiser is withdrawn from its station, arrangements are usually made for another cruiser to take its place. The cruisers are, of course, doing police work while on passage to and from the coaling ports. The coaling arrangements will be considered, in the general review of the policing arrangements which is in hand.

Mr. D. G. SOMERVILLE: Is it not a fact that the statements in Question 46 would aply equally to the Navy if new vessels are not laid down?

Mr. SKELTON: I have not yet answered question 46.

Mr. MACLEAN: 46.
asked the Secretary of State for Scotland whether, seeing that the "Vigilant,"47 years old and with a speed of 11 knots, the "Brenda,"35 years old and with a speed' of 12 knots, and the "Minna," 33 years old and with a speed of 11 knots, three of the vessels under the superintendence of the Fishery Board of Scotland, are too old and too slow to give satisfactory service in protecting the fishing areas against illegal trawling, he will consider replacing them with more modern and speedier vessels?

Mr. SKELTON: These vessels are still rendering useful service. Their limitations are, however, realised and the question of replacement will be considered in the general review of the policing arrangements.

Mr. MACLEAN: Is the hon. Gentleman aware of the criticisms that are being made by the fishermen themselves as to these vessels being unable to perform their duties, and is it not a fact that yesterday in this House criticisms were made of one of these vessels because of its inadequacy for policing purposes?

Mr. HENDERSON STEWART: Will the hon. Gentleman consider in the near future adding to the number of vessels engaged on police patrol duties, in order that they may actually perform the services for which they are intended 9

Mr. SKELTON: The whole question of policing, and indeed the whole question of the suppressing of illegal trawling, is, as my hon. Friends know, under review. The first chapter will be a new Bill on the subject of the penalties. In connection with that, a careful review is going on as to the question of policing. May I say that the problem of policing is something like the problem of trying to catch 90 criminals with four policemen?

Mr. MACLEAN: Does not that prove that the vessels mentioned in the question are inadequate to do the work?

Mr. SKELTON: I have stated in the original answer that the limitation of
these vessels is realised and that we shall consider the question of their replacement. Before you decide what the replacement vessels must be and what their character, speed and so on must be, a general review of the policing requirements must be undertaken. That is being undertaken at the present time, and I could not, by way of question and answer, go into all the difficult points that are involved.

Mr. McGOVERN: May I say, on behalf of the illegal trawlers, that the position is quite satisfactory?

Mr. DEPUTY-SPEAKER: We had a Debate upon this subject yesterday.

Oral Answers to Questions — TRANSPORT.

RIVER THAMES (MOTOR VESSELS).

Mr. MANDER: 49.
asked the Minister of Transport the present position with regard to the provision of water omnibuses on the Thames?

The PARLIAMENTARY SECRETARY to the MINISTRY of TRANSPORT (Lieut.-Colonel Headlam): I understand that a scheme for the running of motor vessels on the Thames has been prepared by the Thames Water-bus Committee, and that the scheme has been submitted to the London and Home Counties Traffic Advisory Committee, by whom it will be considered at an early date.

Mr. MANDER: Has this been submitted to the London Passenger Transport Board?

Lieut.-Colonel HEADLAM: I understand that it was submitted to the London Passenger Transport Board, but they decided that they had other schemes which were more pressing.

MOTOR INSURANCE.

Mr. MANDER: 50.
asked the Minister of Transport if he will consider the advisability, with a view to the prevention of accidents, of proposing legislation making it impossible for the driver of a motor car to insure himself against the consequences of any accident amounting to less than £10?

Lieut.-Colonel HEADLAM: My hon. Friend has already given careful con-
sideration to a somewhat similar proposal, and has reached the conclusion that an uninsurable risk up to a sum of £10, as suggested by the hon. Member, would be equivalent in many cases to depriving the injured person of the compensation due to him. I do not think therefore that amending legislation on these lines is desirable.

Mr. MANDER: Does the hon. Gentleman not think that drivers would be much more careful if they knew that they would have to find these sums of money out of their own pockets?

Lieut.-Colonel HEADLAM: I think that it might be very difficult for many drivers to find these sums.

Lieut.-Commander AGNEW: Would it not cause great hardship to the small motor-car owner if be could not receive this money back?

Mr. CAPORN: Does this not appear to exclude the third party question, as this -.C10 is only in respect of risk to the driver?

DRIVERS' SIGNALS.

Mr. WHITESIDE: 51.
asked the Minister of Transport whether he is aware that runny road accidents are caused through inadequate signalling on the part of drivers; and whether he will consider making it obligatory for all tramcars, omnibuses, delivery vans, and lorries to carry an electric-signalling device

Lieut.-Colonel HEADLAM: I am aware that inadequate signalling, like other faults on the part of drivers, may cause accidents. Proper signals by hand, however, are, in my opinion, adequate for their purpose, and my hon. Friend does not, as at present advised, propose to make the use of electrical or mechanical signals compulsory. This is in accordance with the unanimous recommendations of the Departmental Committee on Traffic Signs which considered this subject.

Mr. WHITESIDE: Is my hon. and gallant Friend aware that it is impossible for an omnibus driver to signal so that oncoming traffic can see what he is doing, because the omnibus is too large?

Oral Answers to Questions — HONG KONG (MUI-TSAI SYSTEM).

Mr. MANDER: 56.
asked the Secretary of State for the Colonies what recent
information he has received from Hong Kong as to the progress made in the carrying out of the ordinance relating to mui-tsai in Hong Kong; how many inspectors have been appointed and whether steps have been taken to secure the compulsory registration of all adopted children in the colony; whether cases of ill-treatment and cruelty still come before the courts in Hong Kong and what penalties have been inflicted; and what provision is made for the care and control of the girls when freed, and if any steps are taken to find them suitable employment?

Captain AUSTIN HUDSON (Lord of the Treasury): The latest information available is contained in the Governor's despatch of the 4th of July, of which my right hon. Friend placed a copy in the Library. Registration applies only to girls who were formerly mui-tsai. Three full-time inspectors are employed for their supervision. Particulars of the prosecutions under the ordinance are given in the despatch; no case of ill-treatment of registered mui-tsai was reported. With regard to the last part of the question, I would again refer the hon. Member to the despatch, which gives particulars of the later history of the girls. As regards those who seek other employment in the colony, there are several benevolent institutions which help the Government in finding openings for them.

Mr. LUNN: Are any mui-tsai being imported into Hong Kong at present?

Captain HUDSON: I will ask my right hon. Friend to let the hon. Gentleman know.

Oral Answers to Questions — NEWFOUNDLAND.

Captain PETER MACDONALD: 57.
asked the Secretary of State for Dominion Affairs who will be appointed as the British members of the proposed Newfoundland Commission of Government?

The SECRETARY of STATE for DOMINION AFFAIRS (Mr. J. H. Thomas): My hon. and gallant Friend will appreciate that action cannot be taken in the matter until the Bill which it is proposed to introduce shortly has been passed.

Oral Answers to Questions — COAL INDUSTRY.

OUTPUT.

Mr. L. SMITH: 58.
asked the Secretary for Mines by what number of tons approximately British coal production fell off in 1932 in comparison with 1913 by reason of exports and home consumption, respectively?

The SECRETARY for MINES (Mr. Ernest Brown): As compared with 1913, the output of coal in Great Britain in 1932 declined by about 784 million tons. Of this decrease, shipments of coal, coke and manufactured fuel (in terms of coal), excluding shipments coastwise, but including coal shipped for the use of steamers engaged in the foreign trade, accounted for rather more than 44 million tons, and home consumption for a little over 34 million tons.

Mr. T. SMITH: Can the hon. Gentleman give any indication of what the Government intend to do with regard to this matter?

Mr. BROWN: The Government have already done many things, in one or two of which they have not been supported by hon. Members opposite.

Mr. SMITH: Is the hon. Gentleman aware that in the Humber ports complaints have been made that they cannot get coal?

Mr. BROWN: If the hon. Member will give me definite cases, I will look into them. I have already made some inquiries, and given answers in this House.

OIL EXTRACTION.

Mr. L. SMITH: 59.
asked the Secretary for Mines for how long the hydrogenation of coal has been carried out on a commercial scale in Germany; what was the type of coal used; what was the measure of protection given; and what is the present approximate annual production of oil as a result?

Mr. E. BROWN: I am endeavouring to secure the information, and, if my hon. Friend will repeat his question on Tuesday next, I hope to be in a position to answer it.

BUSINESS OF THE HOUSE.

Mr. LANSBURY: May I ask the Prime Minister what will be the course of
business next week, and why he is proposing the suspension of the Eleven o'Clock Rule to-night?

The PRIME MINISTER (Mr. Ramsay MacDonald): The business for next week will be as follows:
Monday: Committee stage of the Unemployment Money Resolution.
Tuesday: Second Reading of the Newfoundland Bill, and, if there is time, the Committee stage of the Agricultural Marketing Bill; Motion to approve the Potato Marketing Scheme made under the Agricultural Marketing Acts.
Wednesday: Private Members' Motions.
Thursday: The business for Thursday will be announced later.
Friday: Private Members' Bills.
On any day, if there is time, other Orders may be taken.
As regards the suspension of the Eleven o'Clock Rule" which I am about to move, the Government desire to obtain the Committee stage of the Newfoundland Money Resolution, the Second Reading of the Agricultural Marketing Bill, and the Committee stage of the necessary Money Resolution. The suspension of the Eleven o'Clock Rule is precautionary; the Government do not anticipate an unduly late sitting.

Mr. LANSBURY: May I point out that there is no provision for the Report stage of the Newfoundland Money Resolution?

The PRIME MINISTER: We were hoping to get that to morrow, in order to facilitate the publication of the Bill. That is by agreement. The Bill, as the House knows, cannot be published until these preliminary proceedings have been completed.

Earl WINTERTON: May I ask what exactly the Prime Minister means when he says that he hopes to get the Report stage to-morrow? He does not propose to take any of the private Members' time?

The PRIME MINISTER: It is by agreement.

Earl WINTERTON: What is by agreement?

The PRIME MINISTER: By consent.

Earl WINTERTON: Of the House?

The PRIME MINISTER: Yes; not by taking private Members' time.

Mr. LANSBURY: I was going to raise that point with the Prime Minister. Would it not be possible to turn the business round, and take the Newfoundland Bill on Thursday? That would enable the House to consider the Report stage of the Money Resolution on a day not devoted to private Members. We do not know whether or not we should like to discuss further the proposals embodied in the Money Resolution. We cannot discuss it after four o'clock to-morrow. If we could take it on another night, it would meet the ordinary custom of the House without breaking into private Members' time.

The PRIME MINISTER: The right hon. Gentleman has given me no notice of this, and at the moment it is difficult to visualise the course of business. I sympathise with his objection and, if he will communicate through the usual channels during the day, we shall be perfectly willing to make the arrangement which will suit all Members best.

Motion made, and Question put,
That the Proceedings on Government Business be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)."-[The Prime Minister.]

The House divided: Ayes, 253; Noes, 34.

Division No. 11.]
AYES.
[3.42 P.m.


Acland, Rt. Hon. Sir Francis Dyke
Crossley, A. C.
Howitt, Dr. Alfred B.


Acland-Troyte, Lieut.-Colonel
Cruddas, Lieut.-Colonel Bernard
Hudson, Capt. A. U. M. (Hackney, N.)


Adams, Samuel Vyvyan T. (Leeds, W.)
Culverwell, Cyril Tom
Hudson, Robert Spear (Southport)


Agnew, Lieut.-Com. P. G.
Curry, A. C.
Hurd, Sir Percy


Albery, Irving James
Davison, Sir William Henry
Hurst, Sir Gerald B.


Amery, Rt. Hon. Leopold C. M. S.
Denman, Hon. R. D.
Jackson, Sir Henry (Wandsworth, C.)


Anstruther-Gray, W. J.
Denville, Alfred
Jackson, J. C. (Heywood & Radcliffe)


Applin, Lieut.-Col. Reginald V. K.
Despencer-Robertson, Major J. A. F.
Janner, Barnett


Astor, Viscountess (Plymouth, Sutton)
Drewe, Cedric
Jesson, Major Thomas E.


Baillie, Sir Adrian W. M.
Dugdale, Captain Thomas Lionel
Johnston, J. W. (Clackmannan)


Baldwin, Rt. Hon. Stanley
Duncan, James A. L. (Kensington, N.)
Jones, Sir G. W. H. (Stoke New'gton)


Balfour, Capt. Harold (I. of Thanet)
Eden, Robert Anthony
Ker, J. Campbell


Balniel, Lord
Edmondson, Major A. J.
Knight, Holford


Barclay-Harvey, C. M.
Elliot, Rt. Hon. Walter
Knox, Sir Alfred


Beaumont, Hon. R.E.B. (Portsm'th,C.)
Elmley, Viscount
Law, Sir Alfred


Benn, Sir Arthur Shirley
Emrys-Evans, P. V.
Leighton, Major B. E. P.


Betterton, Rt. Hon. Sir Henry B.
Erskine, Lord (Weston-super-Mare)
Lennox-Boyd, A. T.


Blindell, James
Erskine-Bolst, Capt. C. C. (Blackpool)
Levy, Thomas


Bossom, A. C.
Essenhigh, Reginald Clare
Lewis, Oswald


Boulton, W. W.
Evans, Capt. Ernest (Welsh Univ.)
Lindsay, Kenneth Martin (Kilm'rnock)


Bowater, Col. Sir T. Vansittart
Falle, Sir Bertram G.
Llewellin, Major John J.


Bowyer, Capt. Sir George E. W.
Fielden, Edward Brocklehurst
Lloyd, Geoffrey


Braithwaite, J. G. (Hillsborough)
Fleming, Edward Lascelles
Lockwood, John C. (Hackney, C.)


Brass, Captain Sir William
Foot, Dingle (Dundee)
Lovat-Fraser, James Alexander


Briscoe, Capt. Richard George
Foot, Isaac (Cornwall, Bodmin)
Lumley, Captain Lawrence R.


Broadbent, Colonel John
Fraser, Captain Ian
Mabane, William


Brocklebank, C. E. R.
Fuller, Captain A. G.
MacAndrew, Lieut.-Col. C. G.(Partick)


Brown, Col. D. C. (N'th'l'd., Hexham)
Gilmour, Lt.-Col. Rt. Hon. Sir John
MacAndrew, Capt. J. O. (Ayr)


Brown, Ernest (Leith)
Glossop, C. W. H.
McConnell, Sir Joseph


Browne, Captain A. C.
Glyn, Major Ralph G. C.
MacDonald, Rt. Hon. J. R. (Seaham)


Buchan, John
Goff, Sir Park
MacDonald, Malcolm (Bassetlaw)


Buchan-Hepburn, P. G. T.
Goldie, Noel B.
Macdonald, Capt. P. D. (I. of W.)


Burghley, Lord
Goodman, Colonel Albert W.
McEwen, Captain J. H. F.


Burgin, Dr. Edward Leslie
Gower, Sir Robert
McKie, John Hamilton


Burnett, John George
Graham, Sir F. Fergus (C'mb'rl'd, N.)
McLean, Major Sir Alan


Cadogan, Hon. Edward
Graves, Marjorie
McLean, Dr. W. H. (Tradeston)


Campbell, Sir Edward Taswell (Brmly)
Gretton, Colonel Rt. Hon. John
Macpherson, Rt. Hon. Sir Ian


Caporn, Arthur Cecil
Grigg, Sir Edward
Maitland, Adam


Carver, Major William H.
Grimston, R. V.
Mander, Geoffrey le M.


Castlereagh, Viscount
Guest, Capt. Rt. Hon. F. E.
Manningham-Buller, Lt.-Col. Sir M


Cazalet, Thelma (Islington, E.)
Guinness, Thomas L. E. B.
Margesson, Capt. Rt. Hon. H. D. R


Chamberlain, Rt. Hon. N. (Edgbaston)
Guy, J. C. Morrison
Mason, David M. (Edinburgh, E.)


Chorlton, Alan Ernest Leofric
Hall, Capt. W. D'Arcy (Brecon)
Mason, Col. Glyn K. (Croydon, N.)


Clayton, Sir Christopher
Hamilton, Sir R. W.(Orkney & Zetl'nd)
Mayhew, Lieut.-Colonel John


Cochrane, Commander Hon. A. D.
Hannon, Patrick Joseph Henry
Mills, Major J. D. (New Forest)


Colfox, Major William Philip
Harris, Sir Percy
Milne, Charles


Collins, Rt. Hon. Sir Godfrey
Hartington, Marquess of
Molson, A. Hugh Elsdale


Colville, Lieut.-Colonel J.
Hartland, George A.
Monsell, Rt. Hon. Sir B. Eyres


Conant, R. J. E.
Harvey, George (Lambeth, Kenn'gt'n)
Moore, Lt.-Col. Thomas C. R. (Ayr)


Cook, Thomas A.
Headlam, Lieut.-Col. Cuthbert M.
Morris, Owen Temple (Cardiff, E.)


Cooke, Douglas
Heilgers, Captain F. F. A.
Morris-Jones, Dr. J. H. (Denbigh)


Cooper, A. Duff
Henderson, Sir Vivian L. (Chelmsford)
Muirhead, Lieut.-Colonel A. J.


Crooke, J. Smedley
Heneage, Lieut.-Colonel Arthur P.
Munro, Patrick


Crookshank, Col. C. de Windt (Bootle)
Holdsworth, Herbert
Nall, Sir Joseph


Crookshank, Capt. H. C. (Gainsb'ro)
Hore-Belisha, Leslie
Nicholson, Godfrey (Morpeth)


Cross, R. H.
Horobin, Ian M.
Nicholson, Rt. Hn. W. G. (Petersf'ld)


Nunn, William
Ross Taylor, Walter (Woodbridge)
Tate, Mavis Constance


Ormsby-Gore, Rt. Hon. William G. A.
Ruggles-Brise, Colonel E. A.
Thomas, Fit Hon. J. H. (Derby)


Palmer, Francis Noel
Runciman, Rt. Hon. Walter
Thomas, James P. L. (Hereford)


Peaks, Captain Osbert
Russell, Albert (Kirkcaldy)
Todd, A. L. S. (Kingswinford)


Peat, Charles U.
Russell, Alexander West (Tynemouth)
Train, John


Perkins, Walter R. D.
Russell,Hamer Field (Sheffield,B'tside)
Tree, Ronald


Petherick, M.
Russell, R. J. (Eddisbury)
Wallace, John (Dunfermline)


Polo, Geoffrey K.(W'verh'pt'n,Bilston)
Salmon, Sir Isidore
Ward, Irene Mary Bewick (Wallsend)


Pickford, Hon. Mary Ada
Salt, Edward W.
Wardlaw-Milne, Sir John S.


Pike, Cecil F.
Samuel, Sir Arthur Michael (F'nham)
Wedderbunn, Henry James Scrymgeour


Potter, John
Sandeman, Sir A. N. Stewart
Wells, Sydney Richard


Powell, Lieut.-Col. Evelyn G. H.
Scone, Lord
White, Henry Graham


Pownall, Sir Assheton
Shaw, Helen B. (Lanark, Bothwell)
Whiteside, Borras Noel H.


Procter, Major Henry Adam
Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Williams, Charles (Devon, Torquay)


Pybus, Percy John
Smith, Louis W. (Sheffield, Hallam)
Williams, Herbert G. (Croydon, S.)


Ramsay, Capt. A. H. M. (Midlothian)
Smith, R. W. (Aberd'n & Kinc'dine, C.)
Wills, Wilfrid D.


Ramsay, T. B. W. (Western Isles)
Smithers, Waldron
Wilson, Lt.-Col. Sir Arnold (Hertf'd)


Ramsbotham, Herwald
Somervell, Sir Donald
Wilson, Clyde T. (West Toxteth)


Rathbone, Eleanor
Somerville, Annesley A. (Windsor)
Wilson, G. H. A. (Cambridge U.)


Rea, Walter Russell
Somerville, D. G. (Willesden, East)
Windsor-Clive, Lieut-Colonel George


Reed, Arthur C. (Exeter)
Sotheron-Estcourt, Captain T. E.
Winterton, Rt. Hon, Earl


Reid, Capt. A. Cunningham-
Southby, Commander Archibald R. J.
Womersley, Walter James


Reid, David D. (County Down)
Spender-Clay, Rt. Hon. Herbert H.
Wood, Rt. Hon. Sir H. Kingsley


Reid, William Allan (Derby)
Stanley, Lord (Lancaster, Fylde)
Wood, Sir Murdoch McKenzie (Banff)


Rhys, Hon. Charles Arthur U.
Stanley, Hon. O. F. G. (Westmorland)
Young, Rt. Hon. Sir Hilton (S'v'noaks)


Rickards, George William
Stewart, J. H. (Fife E.)



Roberts, Sir Samuel (Ecclesall)
Stourton, Hon. John J.
TELLERS FOR THE AYES.—


Robinson, John Roland
Strauss, Edward A.
Sir Frederick Thomson and Sir


Rosbotham, Sir Thomas
Sueter, Rear-Admiral Murray F.
George Penny.


Ross, Ronald D.
Sugden, Sir Wilfrid Hart



NOES.


Attlee, Clement Richard
Jones, J. J. (West Ham, Silvertown)
Nathan, Major H. L.


Batey, Joseph
Jones, Morgan (Caerphilly)
Owen, Major Goronwy


Cape, Thomas
Lansbury, Rt. Hon. George
Parkinson, John Allen


Cocks, Frederick Seymour
Lawson, John James
Price, Gabriel


Grippe, Sir Stafford
Llewellyn-Jones, Frederick
Smith, Tom (Normanton)


Dagger, George
Lunn, William
Tinker, John Joseph


Davies, David L. (Pontypridd)
Macdonald, Gordon (Ince)
Wedgwood, Rt Hon. Josiah


Davies, Rhys John (Westhoughton)
McEntee, Valentine L.
Williams, Edward John (Ogmore)


Edwards, Charles
McGovern, John
Williams, Dr. John H. (Llanelly)


Grundy, Thomas W.
Maclean, Nell (Glasgow, Govan)
Williams, Thomas (York., Don Valley)


Hall, George H. (Merthyr Tydvil)
Mainwaring, William Henry



John, William
Maxton, James
TELLERS FOR THE NOES.—




Mr. D. Graham and Mr. T. Groves.

MESSAGE FROM THE LORDS.

That they have passed a Bill, intituled, "An Act to amend and declare the law with regard to procedure in causes in the High Court of Justice wherein decree of nullity of marriage is prayed."[Matrimonial Causes (Procedure in Suits for Nullity) Bill [Lords.]

NEWFOUNDLAND [MONEY].

Considered in Committee under Standing Order No. 69.

[Sir DENNIS HERBERT in the Chair.]

Motion made, and Question proposed,
That, with a view to giving effect to certain recommendations of the Royal Commission on Newfoundland referred to in an Address presented to His Majesty by the Legislative Council and the House of Assembly of Newfoundland, it is expedient—

(a) to empower His Majesty by letters patent to revoke the existing letters patent by which the office of Governor of Newfoundland was constituted and the amending letters patent regarding the absence of the Governor from Newfoundland, and to make provision for the administration of Newfoundland on the basis of the said recommendations;
(b) to authorise the making, so long as the administration of Newfoundland is vested in the Governor acting on the advice of a Commission of Government constituted in accordance with the recommendations aforesaid, of advances by way of grant or of loan out of moneys provided by Parliament to the Government of Newfoundland for any of the purposes of the administration of Newfoundland, including the expenses of the public services and the service of the public debt;
(c) in the event of His Majesty being empowered as aforesaid, to authorise the Treasury to guarantee the principal of, and the interest on, any stock issued by the Government of Newfoundland under section two of an Act of the Legislature of Newfoundland entitled the Loan Act, 1033, and the payments to be made under section three of the said Act to the sinking fund to be established thereunder, and to charge on the Consolidated Fund any moneys required to fulfil any such guarantee;
(d) to authorise the Treasury to issue out of the Consolidated Fund by way of temporary advance to the Government of Newfoundland any sums which that Government has power to borrow temporarily under the provisions of section two of the said Loan Act, 1933;
(e) to amend section one of the Colonial Development Act, 1929, by omitting the words "for the Colonies "from subsection (1) of the said section one; and
(f) to authorise the inclusion in any Act to give effect to the foregoing provisions of this Resolution of such incidental and consequential provisions in connection with the matters aforesaid as may be necessary or expedient."—King's Recommendation signified.)—[Mr. Chamberlain.]

3.52 p.m.

The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain): The
Committee may recollect that last month there was presented to the House a White Paper, No. 4479, in the form of a Memorandum by His Majesty's Government in the United Kingdom which acquainted the House with the view of the Government on the report of the Royal Commission on Newfoundland and also of their intention to present to the House proposals to follow on the acceptance by Newfoundland of the recommendations of that Commission. The present Resolution is the first stage of these proceedings. This will in due course be followed by a Bill which will raise a number of extremely interesting and important questions affecting, not only the people of Newfoundland, but wider questions of Imperial relations. To-day we are concerned principally with financial matters, and I therefore intend to confine myself as closely as possible to the financial aspects of these proposals, only touching upon the constitutional side as far as may be necessary to make the proposals clear.
In the autumn of 1922 it became apparent that the Dominion of Newfoundland would be unable to meet her obligations, and in order to tide over the interval, until further investigations could be made, the Government of this country, in conjunction with the Government of Canada, made a joint advance to meet the interest which became due in January, 1933, upon certain loans, our share of which was £166,570. Thereafter the Royal Commission was appointed under the chairmanship of Lord Amulree, and they went out to Newfoundland and made an exhaustive investigation on the spot of all the circumstances. The Committee will remember that the Commission comprised representatives of Canada and Newfoundland, in addition to the chairman appointed from this country. The time needed to make these investigations made it necessary for us again to face the situation when a further instalment became due last July, and, as the Government of Canada were unable to see their way to join with us again in a similar advance to that which we had made in the preceding January, the Government of the United Kingdom alone made the required advance. That came to £384,256, so that the total advanced by the United. Kingdom for those
two instalments came to £550,826. Subsequently, we received the report of the Royal Commission which is in the hands of hon Members—a document which is perhaps one of the most remarkable and interesting ever drawn up in the history of this Empire. We feel under a great debt of obligation to the Chairman and to his colleagues for the great care and exhaustive manner in which they investigated these very involved matters.
They have made recommendations which are of a two-fold character and of far-reaching importance. I should like to emphasise that the two parts of the recommendations are not independent. They are bound up one with the other and must be taken as a whole. They involve a step which is unprecedented—the suspension for a time of the present status of the Dominion and the substitution for its present form of Government of a Governor in Commission. At the same time, in return for that, they involve the acceptance by His Majesty's Government in, the United Kingdom of financial responsibility for the affairs of the Dominion until such time as it becomes self-supporting again. Any hon. Member who has perused this document will agree with me that some of it makes very painful reading. The Commission have been extremely plain spoken in their account of the circumstances which have brought about the present condition of Newfoundland, and I do not wish, at any rate now, to dwell upon it, but only to say that their account shows that the country has been the victim of a vicious and corrupt political system and that in their view it is absolutely essential, if the financial position of the island is to be restored, that it should for a time have a rest from party politics. I think that perhaps it is only right to add that the present Government of Newfoundland has made most strenuous and praiseworthy efforts to bring about a better state of affairs. It is thereafter all the more significant that that Government has endorsed the recommendations of the Royal Commission and has entirely approved of the proposals which they make.
The Government of Newfoundland have now addressed His Majesty praying that new letters patent be issued for the period during which it is suggested that His
Majesty's Government should take over responsibility for the island, and under the new Constitution, which is, of course, of a temporary character, legislative and executive powers will be vested, as I have said, in the Governor assisted by six commissioners. Three of these Commissioners will be appointed from Newfoundland and three from this country upon the advice of His Majesty's Ministers in the United Kingdom. The Government Departments will be gathered together into six groups, and one of the six Commissioners will take charge of each group. The decision of the Governor in Commission will be taken by a majority, the Governor being the chairman of the Commission. It is further provided that the higher appointments in the public service will be subject to approval by His Majesty's Government in the United Kingdom. Any new law approved by the Governor would be subject to disallowance by His Majesty on the advice of His Majesty's Ministers here, and the Committee will, therefore, see that a very full control has been assured to Parliament, especially as provision is made that there shall be no alteration in the form of government while we remain responsible without it being submitted and approved by this Parliament.
I think that I ought to make clear the financial scheme. The present public debt of Newfoundland, including certain temporary advances, amounts to £17,500,000 plus 9,000,000 Canadian dollars. The addition of these two items, taking the present rate of exchnage, is in the neighbourhood of £19,000,000. The yearly interest amounts to nearly £1,000,000, and that, as hon. Members may have noticed in the report of the Commission, amounts to no less than 65 per cent. of the total revenue of the Dominion. Some 30 per cent. of that debt was incurred before the War; 13 per cent. of it was for War purposes and the remaining 57 per cent. was a post-War debt, partly for schemes of capital expenditure on public works, and so on, which have not proved to be remunerative, but largely in order to meet the Budget deficits. It is a fact that there has been a deficit every year since the War, that deficit averaging about 2,000,000 dollars, and aggregating some 27,000,000 dollars—Canadian dollars, which is the currency of the island—and
there has been a loan to meet the deficiencies in every one of the 12 years from 1920 to 1932.
I said that the present Government had made very commendable efforts to reduce expenditure, and to try to bring the expenditure of the country in line with its revenue, but although they have cut down expenditure by very large sums, they have, in the end, been beaten by the economic depression, and particularly by the disastrous fall in the prices obtained for their principal products, which are cod fish and wood pulp. The result has been that since 1929 there has been an increasing gap between revenue and expenditure, and in the current year the Royal Commission estimate that the deficit will be something of the order of 3,250,000 dollars. In summing up their main conclusions, the Royal Commission tell us that they feel that the debt of the country is out of all proportion to its capacity to pay. They express the opinion that the deficit is likely to continue in the neighbourhood of 3,000,000 dollars, that there is at the present time an imminent danger of the general collapse of the social and economic structure, and that even if trade should regain its normal dimensions, we must expect that equilibrium cannot be obtained without some relief from the burden of debt. The current expenditure since 1931 has been reduced by as much as 2,000,000 dollars, and I am bound to say that, on the report of the Royal Commission, I think we must draw the conclusion that the expenditure has now been reduced below the limit of efficiency in the country. The standard of life of the people has been brought down to a level which it is difficult to contemplate with anything like complacency, and it is probable that if the trade of the country is not to be entirely strangled, we must look forward to some reduction in the revenue.
In these circumstances, there seem to be only two alternatives open to His Majesty's Government—either they must respond to the invitation, to the request of Newfoundland that we would come to their aid, and that we would, in the absence of any possibility of assistance from any other quarter, take upon ourselves for a time the deficiencies which they are unable to meet, or we must contemplate that Newfoundland should default on its obligations. There are very
strong objections of what I might call a sentimental character to the idea that Newfoundland should default. It is our proud boast that up to the present time no Empire Government, indeed, I believe, no Empire municipality even, has ever yet defaulted, and it would indeed be a sad and tragic thing if for the sake of a comparatively small country, when we compare it with the revenues of a great and wealthy land like our own, we should allow this magnificent record to be broken in upon now. In addition to that, we cannot forget that we have in Newfoundland not only our oldest colony, but that during the Great War the contribution which Newfoundland made to the Empire was in proportion to its population very high, and, if we take account of the casualties suffered, that it was a demonstration of the quality of the race of Newfoundland of which Newfoundland itself may well be proud. In the War, the Newfoundland contingent had the largest proportion of casualties of Any Dominion contingent overseas, and the highest possible tribute should be paid both to the seamen of the Royal Naval Reserve, who showed the utmost bravery in the most trying conditions, and also to the regiment which has well earned for itself the title "Royal."
Those objections to the course of refusing to come to the aid of Newfoundland, of standing on one side and seeing her suffer humiliation and loss by default, are very strong. But there are also very powerful reasons on the economic side why, in the interests of the Empire as a whole, we should endeavour to preserve Newfoundland's financial credit. Not only would default now completely shatter the credit of the country itself, and make it impossible for Newfoundland to raise money in the future for many years at any reasonable rate, but we might expect it would have considerable repercussions all over the Empire, and would at once begin to tarnish the name of those trustee securities which are trustee securities under the Colonial Stock Acts; that confidence which has hitherto been felt that it was safe to lend money to the British Empire would be injured, and it might be found that many other parts of the world which acknowledge allegiance to His Majesty would find themselves hampered in their financial arrangements in the future by the default of one of their members.
Therefore, the Government had little hesitation in making the decision as to what their course should be. They decided that they would accept the recommendations of the Royal Commission, that they would come to the aid of Newfoundland, and that they would accept financial responsibility, coupled with those alterations in the constitution which form an integral part of these recommendations, with the hope that they might help that country to overcome its difficulties, and gradually to work back again to a position in which it would be able to support itself. The Royal Commission did not themselves indicate the precise way in which the finances of the Dominions should be dealt with. What they suggested was that such arrangements should be made as may be deemed just and practicable, with a view to securing to Newfoundland a reduction in the present burden of the public debt. We have given very anxious consideration to that suggestion, the answer to which is by no means simple. We thought that it would be unfair to the taxpayer of the United Kingdom to take over the liability to make good both the principal and the interest on the present basis of the whole of the Newfoundland debt. A great part of that debt was borrowed in New York, and it was borrowed at rates which, if they did not reflect the gradually weakening position of Newfoundland, certainly did indicate the higher rate of bond interest in New York as compared with that prevailing in London, and, after investigating various alternative ideas, we came to the conclusion that the arrangement which would be most just and practicable would be one which gave to the borrowers the equivalent of 20s. in the pound on their principal, with interest at a reduced rate.
Accordingly, that is the proposal which I have to put before the Committee this afternoon, and, if it be accepted, the bulk of the creditors will not be paid in cash, but will receive stock of equal face value with their present holdings, backed by the Government of the United Kingdom, with interest at 3 per cent., which, we are advised, will produce a par value approximately equivalent to the nominal value of the stock. In the White Paper, No. 4481, which was put into the Vote Office last night, hon. Members will find
in Appendix 3 a detailed statement of the public debt of Newfoundland. It will be seen that it amounts to a total of £17,464,776, and 8,954,750 Canadian dollars. There are a number of loans which are of different kinds, of different denominations, and bearing different rates of interest, and having different conditions attached to them. It will be seen by the footnotes that the holders of loans which are named (a), (b) and (c), the first three items, are to be offered the right to exchange in: D the new Guaranteed Loan. The various loans at the present time carry interest at rates varying from 3 to 62 per cent. The trustee securities will, in addition, have the option of retaining their existing holdings unchanged. The others, non-trustee securities, will not have that right. Item (d), pre-War loans in local currency, will be repaid in cash as it will be rather difficult to find the equivalent of a dollar security with dollars moving about as rapidly as they do in these days. Therefore they will be paid off; and so also will all the loans in the next item (e), which are specially secured. Two of the loans under item (e) are also in dollars. The last, the 4 per cent. sterling loan, is in sterling.

Mr. MAXTON: Where does the Government's £500,000 come in?

Mr. CHAMBERLAIN: The £500,000 that we have already advanced is not in this. That is not a loan. Perhaps I may refer to that point later. These are the proposals, and hon. Members will see that a distinction is made in the treatment of the trustee securities as compared with the securities that are non-trustee. I have seen some suggestions that it is difficult to account for this distinction which, it is suggested, appears to indicate an action on the part of the Government towards trustee stocks in this particular case which is not extended to other trustee stocks such as railway stocks in this country, for example. That distinction arises out of the fact that these trustee securities are under the Colonial Stock Acts, and under the Act of 1900 and by virtue of that Act there is a Treasury Order, dated the 6th December, 1900, which contains the conditions under which loans of this character may be raised by Empire borrowers. I will read the relevant part of that Treasury Order:
The Colonial Government shall place on record a formal expression of their opinion that any Colonial legislation which appears to the Imperial Government to alter any of the provisions affecting the stock to the injury of the stockholder or to involve a departure from the original contract in regard 'to the stock, would properly be disallowed.
These trustee loans were issued by Newfoundland after they had given that expression of their opinion which they did in response to the Treasury Order, made under the authority of an Act of this House. We are now going to place ourselves in the position of the Colonial borrower. It would have been impossible for us altogether to override the conditions which we ourselves had demanded of the borrower, that is the Empire borrower. We have put ourselves in his place and we must therefore give our assent and our accord to the very conditions which we ourselves at a prevous time insisted upon. That is the explanation of the position in regard to these trustee stocks.
The effect of the proposals—if I may assume, as I think I probably may, that the holders of these trustee securities will not exchange but will retain their present rights under the new conditions, and assuming that the other stockholders who are offered the option to exchange, accept that option—will be that the annual interest on the loans will be reduced by £350,000 a year and the debt, apart from the Governmental debt, will amount to £2,000,000 of trustee securities and about £17,000,000 of new stock. The new stock will carry a sinking fund of 1 per cent., which will start not more than five years hence. The burden of that sinking fund will be an additional £170,000 a year, but we may hope that before it begins the financial condition of Newfoundland will be so much improved that that will not prove to be an excessive burden. Nevertheless, I think we must assume that it will be necessary for some years to come for this country to come to the assistance of Newfoundland and to make up deficits in her budget.
I have already explained that in all probability we shall have to increase the expenditure of Newfoundland to some extent and we may suffer some loss of revenue. It would be rather absurd to begin the new arrangement by adding to the debt of Newfoundland and,
therefore, for three years until 1936 we propose that whatever advances are necessary to make good the deficiencies in the Newfoundland budget shall be in the nature of a free gift from this country.

Earl WINTERTON: Has any estimate been made of the probable amount of the deficit next year?

Mr. CHAMBERLAIN: After 1936, if further advances are necessary, they may be by loan or by gift. We have not decided that yet. It is a matter that can be discussed better when we know the conditions at that time. My Noble Friend asked me if I can give any sort of estimate of what this is going to mean. He will understand that anything that one says now must be subject to a good deal of reserve, because there are many features that we cannot be very certain about, but as near as I can see, including the £550,000 which we have already found in the last 12 months, and which we propose should be a free gift, I should imagine that up to December, 1936, the total liability of this country may amount to something from £1,500,000 to £2,000,000. In addition to that, since the new stock will be guaranteed, we have a contingent liability so long as we are responsible for the Newfoundland Government, but any sums which may be payable under that guarantee so long as we are in charge will be found out of moneys voted by this House and will be subject to Parliamentary sanction. They will not be drawn out of the Consolidated Fund.

Sir STAFFORD CRIPPS: Is that additional to the £1,500,000?

Mr. CHAMBERLAIN: If there are any other payments they will be additional to the £1,500,000. The question may be asked what will be the position on redemption in 30 years time—the redemption of the new 3 per cent. stock. At that time the Sinking Fuhd should amount to something like 40 per cent. of the total principal and, of course, if we are still responsible at that time we must then make arrangements for renewal of the loans, but, if not, then ex hypothesi Newfoundland will be self-supporting. In that case we may hope that she may be able on her own credit to raise the necessary loans. For 1934, next year, I should say that the amount of the advance will probably be from £350,000 to £400,000.
I hope I have given a fairly clear account of these rather complicated proposals. The Committee will see that there is very complete Parliamentary control over the whole situation. Before I sit down the House may like to hear something as to the future prospects of the Dominion. We cannot expect that even after the reduction in the debt burden which we hope to achieve by these proposals, Newfoundland will be completely self-supporting; but, at the same time, we think that there is no reason why she should not in time become self-supporting. Her misfortunes are due to misgovernment and also to the fall in prices. Now, with efficient administration and with a prospect of better times generally in world trade altogether, I think that her future is not at all unhopeful. We must remember that Newfoundland is a country of great potential resources. Her chief industry is, of course, her fisheries. In some respects they are the best in the world. They have been somewhat abused, parts have been overfished and there has been no proper provision for scientific renewal of the stock. There. fore there is a great deal undoubtedly to be done in the way of organisation of the industry, lifting it from the present abominable truck system and developing research in methods of improvement.
Newfoundland contains two very large paper mills, one the most modern in the world, and I understand that there is room for a third. They are already holding their own, and any revival in the demand for pulp and paper should add very much to the resources of the country. Newfoundland contains also what I believe is the largest deposit of iron ore in the British Empire, which already employs 2,000 men. There, again, we are hopeful that further progress may take place. The Royal Commission in the course of their extremely interesting report have made various suggestions for the development of other industries, and particularly for the encouragement of the 'breeding of fur-bearing animals which, through defective management, have been almost exterminated in certain parts of the country. There is also a great possibility in the future for Newfoundland as a centre for transatlantic air services, which may become of considerable importance before very long. Finally, New-
foundland has a great territory in Labrador which has been hardly explored at the present time and which certainly has great resources in timber, water power and probably in minerals. Although that will require surveys and the investment of capital, I have no doubt that some day or other Labrador will be a very material addition to the resources of the Dominion.
The Governor in Commission will no doubt he faced with very formidable difficulties, but to anybody with an imaginative and adventurous mind there are great opportunities of a singularly absorbing and fascinating character in the task which will be before him. He has to create a new State, to rehabilitate the ruined finances of the country, to develop her resources, to rebuild the political system of the country on a new basis, and to bring back to the people of Newfoundland some measure of material prosperity and contentment with their lot.

Earl WINTERTON: Can the right hon. Gentleman tell us whether the Governor will be in the same position as an ordinary Colonial Governor, or whether he will be partly under the Colonial Office and partly under the Treasury?

Mr. CHAMBERLAIN: He will be neither, he will be under the Dominions Office. It must be understood that the plan we are suggesting to the Committee is not to be considered as a permanent arrangement, it is a temporary arrangement devised solely for the purpose of enabling Newfoundland to regain her former position, and it would, therefore, be inappropriate that Newfoundland should be transferred from the Dominions Office to another Department of the Government. These are the proposals, and I trust that the Committee will find them acceptable and that we shall be able to say that when our oldest Colony in her darkest hour came to tile Mother Country for help she had no reason to regret the step.

Mr. HANNON: Before the right hon. Gentleman sits down can he add to his illuminating speech a reply to two questions? First, whether any steps will be taken to call to account those responsible for maladministration in the past, and, secondly, whether in the new régime
provision will be made to give preferential treatments to the products of Great Britain?

Mr. CHAMBERLAIN: Those are questions which can be more appropriately raised on the Second Reading of the Bill than on the Financial Resolution.

4.35 p.m.

Mr. LUNN: We shall oppose this Financial Resolution and, as far as I know, we shall oppose the Second Reading of the Bill. We object to the way this matter is being rushed. Why should we be carried along so quickly in order to get it through Why could not we have had more time to consider a White Paper that has only been issued this morning, just a few hours before the Debate? I protest, first of all, against bringing important business of this character before the House without giving hon. Members some opportunity of considering it. We have just listened to an extraordinary speech from the Chancellor of the Exchequer. If I had not been in the House for some six or seven Parliaments I should have been astonished at such a speech, having in mind the speech he made last Monday on the Unemployment Bill and the conclusions at which he arrived with regard to the £115,000,000 owing to the fund by the unemployed. I shall call further attention to that matter. Let us understand this business quite clearly. The Labour party do not object to helping people who are prepared and willing to help themselves, but we do object to the British taxpayer being called upon to make good bankruptcy brought about by wrong doing. The following statement appears in the White Paper:
His Majesty's Government in tile United Kingdom will undertake general responsibility, under the new constitution, for the finances of the Island,…including the debt services. It is proposed that any advances made during the period ending 31st December, 1936, shall be free grants.
It is also laid down in the White Paper that we are to expect a supplementary Estimate in order to provide £225,000. That is all in this year; and for how many years we do not know we are to provide not less than £400,000 a year for Newfoundland. The Chancellor of the Exchequer appeared to be in some doubt as to whether any addition to that £400,000 would be a loan, but it is quite
clear that the £400,000 is to come on to the Vote and will be a grant from this country. We have considered this matter on two previous occasions. We granted loans to Newfoundland in December and February, totalling £550,000; they are now to be regarded as grants. We are to provide before the 1st January next another £250,000; that is, we are to provide something like £800,000 this year for the investors in and moneylenders to Newfoundland. What is the position? There are less than £260,000 people in Newfoundland, and the British taxpayer is to be asked to contribute more than £3 per head for every man, woman and child in Newfoundland—and hon. Members opposite will vote for it.
In my opinion, it is a ramp, a shocking ramp, which could not be justified before the electors of this country if it were put fairly before them. The Chancellor of the Exchequer said that it would be tragic if we were to allow Newfoundland to crash when we could save her, and that the Government had little hesitation in deciding to come to her aid. How different when it comes to the unemployed in our own country ! Take the Chancellor of the Exchequer's statement on Monday last. He let it be understood very definitely that the people of this country could not come to the Treasury and ask for what they wanted. The whole House was demanding that the £115,000,000 owing to the fund should be wiped out, at all events that future contributors to the Insurance Fund should not be expected to make good what has been spent on bread and butter during the last 12 years. We did not ask for £3 from the British taxpayer, if we had it would have been, with 45,000,000 of people, a sum of £135,000,000. We only asked the Government to agree that the burden of the money spent on food and the necessaries of life during the last 12 years should be met by the taxpayers of this country. The right hon. Gentleman and his Government have no hesitation in asking the taxpayers of this country to make good the maladministration of governments over a long series of years over people thousands of miles away. It is not the duty of the British taxpayer to make good maladministration over a long period of years.
My hon. Friend the Member for Lime-house (Mr. Attlee) has described this
Government as a Government for moneylenders. I should describe it as a Government for bandits; it is a bandit Government in the way in which it deals with questions of this sort. The moneylenders and the Stock Exchange can do just what they like with the people of this country. I have a paragraph here which appeared in the "Financial News "of the 23rd November, 1933. It says:
The stocks of 3 per cent. and 3½ per cent., which stood at 71 and 82 on Tuesday, 21st November"—
That is after the report of the Committee came out—
are quoted at 94 and 96 on 23rd November.
Do we understand that this country will have to make good that sort of thing? Have we to pay for the gambling that is going on in this matter? It should be made clear where we are, what our liabilities are going to be; and how far they can fleece us. It is quite clear what is going to happen in this business. I have read the Report of the Commission and I agree with the Chancellor of the Exchequer that it is-a remarkable report. It is one of the most interesting reports, I will put it that way, for there is something in it. One thing in it is that there are in Newfoundland four banks with 20,000,000 dollars and that large sums of money are being hoarded in the homes of Newfoundland. If we had the same amount in the banks of this country for the unemployed they would not be squealing about their poverty and their hunger, they would be able to get everything they desired. I think Newfoundland ought to have been called upon to make good this state of affairs from her own resources rather than ask the British taxpayer to do it.
The Chancellor of the Exchequer also referred to the economic prospects of Newfoundland with regard to the Empire. Newfoundland does not sell her goods to Great Britain. Her fish goes to all parts of the world but here, and the same thing applies to her iron ore, which goes to Germany and other parts of the Continent. They do not buy from here. The hon. Member for Moseley (Mr. Hannon) asked a question as to that. The Report says that half of what Newfoundland buys comes from Canada, one-third from the United States and one-sixth from this country. That
is the position. There is no justification on those grounds for our contributing this sum of money. The people of Newfoundland are not taxed as our people are. Of their revenue 7½per cent. comes from Income Tax. They have no local rates anywhere. In that respect compare their position with that of the people of South Wales, Durham, or my own West Riding of Yorkshire. They have no rates to pay in Newfoundland, and we have to make good a position such as that. It is a position which, we know, has been brought about by greed, graft and corruption. That is the sort of thing that "sticks "with me and makes me hesitate in giving support to this Dominion or to any other Dominion.
There is no justification for our paying Newfoundland's debts by raising a loan of £17,500,000 and for taking the financial responsibility of a part of the Empire which ought to shoulder its own burdens. If Newfoundland had a Government such as 1 would wish them to have, a Government such as I think we usually have in this country—we do carry on business without much question as to maladministration and misappropriation of funds—this sort of thing might not have happened. Moreover, because of Newfoundland's position we are to see its Constitution destroyed. We are to see a form of government which is hardly Crown Colony government. I do not know whether it is a form of government similar to that in the South African Protectorate government as we understand it, and certainly it is not democratic Government. The British taxpayer has a pocket that can always be dipped into and he is expected to provide everything for everybody.

Earl WINTERTON: All over the world.

Mr. LUNN: I agree with the Noble Lord. That is really the position. That is what the Government are doing on this occasion. I question very much whether there will be any more purity in the method that is suggested in the Commission's Report, as I understand it. I have read the report carefully, and I am not so sure that that is not going to be the position, because it is not proposed to eliminate private enterprise: the proposal is to try to build it up again. This is the most glaring experience I have ever known of the failure of private enter-
prise. Private enterprise cannot restore Newfoundland. The Commission say in their report:
Little can be expected of private enterprise in present circumstances.
So our Government is invited to indicate a way out and to give Newfoundland a lead on the right road. We know that Canada does not want Newfoundland. Labrador is to be retained and we are to provide the means. While it may be possible to do something with regard to Labrador, if necessary, rather than come to the poverty-stricken taxpayers of this country to make good what has happened in Newfoundland, I see nothing to justify this House in giving support to the Financial Resolution, which is practically the Bill that will be introduced in a few hours and is to be discussed in a day or two. I hope that the House will give fair consideration to the Bill and will have regard to our own needs before providing money in this particular way.
I have been in Newfoundland. I went there with a Parliamentary delegation some years ago. It is a beautiful country. It has wonderful scenery, there are delightful lakes and rivers, and the people are amongst the most kindly and generous. The mass of the people are very poor indeed but they are hospitable, and I was grateful, and am grateful, for any kindness received from anyone or in any way. But that does not justify me in supporting wrongdoing wherever it happens to be. The Newfoundlanders are hardy, as will be found in the paragraph dealing with the fishing industry; they are brave, as will be found in the paragraphs referring to what they did during the War. They have wonderful resources and they have not a bad climate during some parts of the year. If things were taken in hand, if a tax upon undeveloped land was imposed, as it ought to be, if the resources of the country were used by the people and the proceeds went to the people instead of to a new body of plunderers similar to those that they have had for a generation, I believe there would be a possibility of reorganisation in Newfoundland and that the position could be restored.
Why have not the British Government considered the idea of providing this money as a loan and not as a grant from the British taxpayer? There is need of grants for the millions of people who are unemployed and in poverty in this
country. If the Empire can be held together only by supporting Governments similar to those which have existed in Newfoundland, which have been run, as the report says, on greed, graft, selfishness and corruption, then the Empire is not worth any expenditure by this country. I say that as one who is very interested in the Empire, and very sincere in a desire to help all those who are willing to help themselves. But I am not prepared to go as far as is suggested in this case. There is to be no recoupment whatever to the British taxpayer. All is to go to the bondholders. We do not know how many years it is to continue. It may continue for 10 or 30 years. We are told that a report will be presented to this House every year. So I suppose we shall have some opportunity of raising the matter again.
I am satisfied that in the way we are going on we are endeavouring to smash Vile Empire. There is Ireland, a country which knows very well what it does not want but does not often know what it does want. That is a difficulty for us at the moment and in my opinion it ought never to have arisen. We have also difficulties with protectorates in South Africa. Now we have this difficulty in Newfoundland. Where is it going to end? Are any other Dominions to come and ask for similar consideration?
The Labour party believes it is all wrong, and that we should not bolster up private enterprise in this way after it has failed. We believe that the encouragement of this kind of action in Newfoundland is a policy that will smash the Empire. I know the Government have no particular policy. The Labour party has a policy with regard to the Empire. [HON. MEMBERS: "What is it?"] It can easily be obtained and referred to in this Debate, I advise hon. Members to get it. It was adopted at the Hastings Conference. I am as sure with regard to any part of the Empire as I am with regard to my own country that there is no solution except a Socialist solution. As I happen to be a Socialist and believe that Socialism is the only remedy for our own country's salvation, so I believe it is the only remedy for Newfoundland. It can be applied without calling on the British taxpayer. Let Newfoundland provide the means for its own restoration. It has the necessary resources.

Colonel CROOKSHANK: Will the hon. Gentleman help us by defining how Socialism applies in this case?

Mr. LUNN: The hon. and gallant Member has heard what I have said with regard to the resources of Newfoundland. There is to be a discussion in this House in a fortnight's time, when the hon. and gallant Gentleman will hear how Socialism is going to be applied, as we have heard it on many occasions before.

5.0 p.m.

Sir ROBERT HAMILTON: I cannot imagine a more unpleasant task for a Chancellor of the Exchequer who has been trying to nurse the country's resources than moving a Financial Resolution of this nature. The hon. Member for Rothwell (Mr. Lunn) in the very first sentences which he uttered raised what appears to be the real issue at stake here. He said that we had no responsibility towards Newfoundland. I admit that we have no direct, legal responsibility that could be enforced, but Newfoundland is a member of the British Commonwealth of Nations and, looking at the matter in that aspect, and having regard to the consequences that would follow if Newfoundland were allowed to default on her obligations, I think it must be agreed that we have a very great responsibility and one which extends far beyond our own borders and far beyond the borders of Newfoundland. Once we admit that responsibility we can approach the question from a very different angle from that of the hon. Member for Rothwell.
For a good many years the people of this country have been listening with apprehension to rumours and reports that have been coming across the water as to what was happening in Newfoundland and the matter was forcibly brought to the notice of the House when we were asked to make the advances which are now being granted, to help the country out of its difficulties. Then we come to the appointment of the Royal Commission and I take this opportunity of adding my tribute to those already paid to the remarkable work of that Commission. The care, thoroughness, skill and courage with which they have investigated all the circumstances and conditions of Newfoundland and placed their conclusions before the country are in every way admirable. But, I fear their report makes
distressing reading. Summarised it ie a story of corruption, of bad finance, of unbalanced budgets, and of economic collapse, following on bad seasons, in an ill-organised industry upon which the whole country depended, namely the great industry of fishing.
The result has been complete political and economic breakdown and the question now is: What is to be done? If we do not go to the assistance of Newfoundland nobody else will do so, and there will be default. That default would not merely hurt the bondholders—who seem so to arouse the anger of the hon. Member for Rothwell—but would have serious consequences for all the inhabitants of Newfoudland whose economic condition is none too good at the present time. As regards the actual financial proposals put up by the Commissioners and now before us for consideratian, I can only say, having given them what study I have been able to give them, that they seem to me to be very skilfully drawn. I will not go beyond that. The matter is very complicated and we have to deal, as the Chancellor of the Exchequer pointed out, with special creations of trustee stock with dollar notes and with sterling notes and, over a, period of years, with the revenues of the country which are quite unable to meet the services of those loans. If we are to go to the rescue of the country it is obvious that we shall have to shoulder that burden, unpleasant as it may be—and it is not pleasant to have to face that situation, especially as we know that a great deal of the burden is due to maladministration and misgovernment. I spoke just now of the condition of the people themselves. It used to be said Delirant reges, plectuntur Achivi which rendered into modern political terms may be said to mean that when political leaderi, make a mess of things it is the people who suffer. It is indeed the people who have suffered in Newfoundland. There are three factors which ought to be taken into consideration when we look at the position which has been arrived at in that country. One is the factor of the political corruption which seems to have spread right through the body politic. We must also remember that taxation in that country is almost entirely indirect. There is practically no direct taxation
and, as has already been pointed out, there are no rates. The combination of those factors has led the people to regard the Treasury as a sort of purse of Fortunatus that can be dipped into whenever they want anything. So much has this been the case that even for local requirements, such as small road making or bridge building schemes, it has been the practice to go to the Treasury. They expect the Treasury to pay for the doing of work which they ought to do themselves. When that resource fails, unless the British taxpayer goes to their assistance, I am afraid there is starvation in front of the people of the island.
Hon. Members have doubtlessread the report, and I do not wish to weary them by quoting the paragraphs dealing with such matters as the Truck Act, that abominable Act which is summarised in paragraph 307. That manner of doing business leaves the fisherman constantly in debt and, when bad seasons come, it is impossible for the person who supplies the money to get any work done by the fisherman or for the fisherman to get any return for the work which he does. It leaves him entirely without resources and, incidentally, it reminds me very much of the state of affairs which existed in the bad old days in my own county, when the wretched fisherman was always in debt to the merchant who supplied him with the necessaries for carrying on his industry. The absence of cash is a most serious matter in Newfoundland at the present time. They are reduced almost to a system of barter-and barter under great difficulties. The average income of a teacher in a country district in Newfoundland is about £60, and that teacher is probably the best-off person in the district. People may own their houses and little bits of gardens, and they may be able to cut their own firewood and so forth, but they have no money at all with which to purchase other requirements. The result is a state of almost unbelievable destitution. The people, over a great part of the island, are under-clothed, under-fed, and have not proper medical services. Physical deterioration is setting in and disease is spreading. That is the condition to which the island has been reduced, and these conditions affect the men and the sons of the men whose deeds during the Great War are
spoken of in the report. Hon. Members will forgive me if I quote from pages 40 and 41:
The seamen of Newfoundland had long been known in the Navy as efficient and resourceful, but the end of the War left them with a greatly enhanced reputation. They readily undertook almost impossible boarding operations in wild seas which others would not face. Nothing but praise was accorded by the Fleet.
Then again at Gallipoli they did well, and in the action at Beaumont Hamel on 1st January, 1916, we learn:
The regiment was set to take the village in face of a murderous fire. They went into action 753 strong and only 68 answered the roll call next day.
Those are the men to whose assistance we are asked to go and I, for one, frankly admit that I am far more ready to go to the assistance of those men than I was to vote for the loan to help Austria some time ago. The proposal that the Government of the island should be put in commission means, of course, a complete suspension of responsible government and I think we may take it as a test of the dire straits to which the Colony has been reduced that the people are willing and ready to give up that prized possession of responsible government in order to obtain the assistance of the old country. The Chancellor of the Exchequer did not attempt to say and it is of course impossible to say how long it will be before we see the Colony on its own feet again but we hope it may be soon. There are great possibilities of development. The island is very imperfectly developed. Labrador is not developed, and I cannot understand why the hon. Member for Bothwell should say that it is impossible to develop it by private enterprise. The whole Empire has been developed by private enterprise.

Mr. McENTEE: That is where we get the corruption which we are dealing with now.

Sir R. HAMILTON: The people of Newfoundland have turned to the old country for aid and if I am asked whether we can refuse that aid I would say "No, we cannot." What we can say is and what we ought to say, is that if we give this aid freely to our oldest Colony to prevent it defaulting and to help it to stand on its own feet, we expect the people of the island whole-heartedly to assist in
that task and to bring to it the same courage and tenacity which they showed at Gallipoli and in France.

5.13 p.m.

Mr. AMERY: I think the Committee as a whole can only come to the same conclusion as the hon. Member for Orkney and Shetland (Sir R. Hamilton) namely that we must support the Government in undertaking the very serious financial and political responsibilities involved in their decision regarding Newfoundland. I am sorry that the hon. Member for Rothwell (Mr. Lunn) shows so little sympathy either for the unhappy people of Newfoundland or for the politicians to whose action their present plight is at any rate in part due. As far as the people are concerned, nothing that my hon. Friend the Member for Orkney and Shetland has just said exaggerates the suffering and starvation of which the great majority of the fishing folk of Newfoundland are victims at this moment.

Mr. EDWARD WILLIAMS: That also applies to South Wales.

Mr. AMERY: The money which they are drawing to-day in Newfoundland amounts to one-eighth of what is being paid to our unemployed, and whereas it has been suggested here that our present dole is not enough to keep people in good health, according to the standard set by the British Medical Association, I venture to say that not one-third of the fishermen of Newfoundland are able to live at anything like that standard at the present time. We are face to face with the fact that a population of our own fellow subjects who gallantly played their part in the Great War are now subject to miseries of which we in this country have no idea. When I come to the severity of the hon. Member for Rothwell towards the politicians, I must point out to him that, after all, what they have done in Newfoundland is what politicians always tend to do with an ignorant electorate. They gave easy promises, they set out to catch votes, they readily paid doles, and when the hon. Member for Rothwell objected in principle to this House being called upon to "make good the bankruptcy that has come from political maladministration," if I were to make a party point, I would suggest that that was the very purpose
for which the National Government were brought into existence in this country a couple of years ago.

Mr. E. WILLIAMS: Is the right hon. Gentleman thinking of the Enclosure Acts, when advantage was taken of the people's ignorance?

Mr. AMERY: I am thinking of the course of government which brought this country to the verge of bankruptcy two years ago. On the same lines, to a large extent, Newfoundland will have to be set right in the near future. I would add, as some mitigation of the mistakes and follies of the Newfoundland Government in recent years, that we must make some allowance for the terrible tide of adversity which has overwhelmed them, which must overwhelm a country living almost entirely on primary production and mainly on one crop, at a time when all world prices have been almost cut in two. I will give the House one figure from the Commission's Report. The average price that Newfoundland got for the product of her cod fisheries, her main source of livelihood, for the years 1928–30 inclusive was nearly 12,000,000 dollars, but for the last two years the average price was 5,000,000 dollars for a 10 per cent. less output—half the revenue of the country swept away. It does not require too excessive waste or too excessive improvidence, even in a small democratic community, to make the position impossible when you are confronted with such a situation as that. I would add, therefore, that whatever else happens in Newfoundland, the general monetary position must be borne in view. If we look upon the Empire as a whole, it is not only Newfoundland; there is many another colony that is suffering in almost the same way, and in some cases it has had to be supported by the Imperial Government. We are confronted by a problem in the Br fish Empire that is not unlike that which. President Roosevelt is facing in the United States to-day, and I think we shall, need to follow, not necessarily exactly his methods, but something of his courage in dealing with it.
Certainly it is a very heavy financial and political responsibility that we are undertaking. The question is, In what spirit are we going to undertake it, and what is the purpose that we are now
setting before us? After all, there are two ways in which we can face this problem. One is that our Commissioners should thriftily, cautiously, timidly nurse back Newfoundland into bare solvency, and then hand it over, substantially the same place, to the same people, a country living under substantially the same conditions, and faced with the certainty sooner or later that it will slide back into disaster. There is not the human material, there is not the organisation to-day, which could enable that colony to make use of its resources. The other alternative is that we shall deliberately set before ourselves the task which the commission envisage when they talk of a constructive forward policy; the task of rebuilding Newfoundland from the foundation, of lifting that little country, with its splendid stock of people and its great resources, on to a new plane of economic life. That is a task which they alone can never carry out, but which, with the capital, the ability, and the directing power of this country, they can achieve.
It is not the first time that we have done this sort of thing. My mind goes back some 30 years to the conclusion of the South African War, when my right hon. Friend's father and Lord Milner had to undertake a task which in many respects resembled the task that we are undertaking in Newfoundland to-day. Over a vast territory you had every farm destroyed, every dam for water broken, all the cattle swept away, the whole life of the country reduced to chaos. You had 40,000 refugees, prisoners, and others brought back and dumped on to an empty country. Moreover, they were people who had no real agricultural tradition. There was no effective agricultural life, beyond mere squatting, in the Transvaal. Lord Milner had to face, first, the task of feeding those people, rationing them for a year or two, educating their children, and then creating from the very foundations a new life for the country, creating an effective agricultural department, a research department, agricultural training colleges, importing fresh stock to raise the whole standard of the cattle and the plants of that country, introducing an effective forestry department, an irrigation department—in fact, recreating the whole productive life of that country from its very foundations. He had to create a new Civil Service—the
conditions in the Transvaal before the South African War were not very dissimilar from those of Newfoundland—he had to provide a, system of education, and for all these purposes he had to bring in new blood.
He brought in, first of all, a wonderful team of enthusiastic, keen, young men with driving power. "The kindergarten," they were sometimes contemptuously called at first, but South Africa has long ago abandoned any attitude of contempt for the young men whom Lord Milner brought into that country. More than that, he insisted upon a widely-spread scheme of land settlement, not with the idea of displacing the Boer settlers, not with the belief that you could really bring out an immense number of settlers, but in order to bring in new blood, new ideas, a new spirit of progress in agriculture. For all that work his master key was the revenue provided by the mining industry, and, secondly, as an essential temporary measure, a substantial loan of £6,000,000 or £7,000,000 for reconstruction.
All those conditions apply in Newfoundland to-day. You have a population, scattered around its thousand miles of coastline, of which a very large part are practically starving to-day. Whatever else we have to do, we have to see that somewhow or other those people are fed. That is one of the first tasks that the Commission have to face. Their standard of health from the point of view of medical care is appalling, apart from the wonderful work done by Sir Wilfred Grenfell in Labrador. You have to provide education, an immensely difficult task. Just as we gave education in the camps, in the Transvaal, at the end of the South African war, we may have to bring children together to some central points or boarding schools in Newfoundland in order to educate them. There is a tremendous task to be carried out there. The foundation of it all, the master key, which in South Africa was gold, in Newfoundland is the fisheries. That is made abundantly clear in the report, and undoubtedly the fisheries will want further reorganisation. The vicious system of truck must be got rid of You have to improve the whole character of the fishing boats, the catch, the method of dealing with it, the provision of bait, and a hundred and one things, and you have, behind all that,
to have effective research. I am glad to think that I had something, at any rate, to do with the establishment of the fishery research station under the Empire Marketing Board, which is already yielding such wonderful results, as indeed the work of the Empire Marketing Board has been yielding everywhere, and would still be yielding if it had not been unfortunately cut down.
It is not only on fisheries, however, that Newfoundland must rely in future. You want research in many other directions as well. Here is a country which is probably rich in minerals. One of the first tasks before the Commissioners is to provide an effective geological survey. One of the next tasks is to provide an effective soil survey, so that we may know what the agricultural possibilities of the colony are. The Commissioners say—and from what I have seen I can readily confirm it—that the emptiest part of Newfoundland, the West coast, is fertile, and from what I have seen I should say that the Humber Valley and the Bay of Islands are at any rate as good as any of the fertile agricultural country in the neighbourhood of Oslo, in Norway, and could in the same way support an agricultural population.
But the existing population have very limited ideas, all based on fishing. The existing political system has never yet envisaged agriculture, except as a small allotment business in the spare time of men whose only idea is fishing. You have to create an agricultural department, you have to bring in the right type of cattle, sheep, and goats, you have to carry out Sir Wilfred Grenfell's splendid work in connection with reindeer in the North of Labrador, for reasons which are so admirably put in the Report, owing to the absolute failure of the Government to support him in his work. You have to do an immense number of things, and for that purpose you must bring in new blood, as you did in South Africa. I hope that not only my right hon. Friends the Chancellor of the Exchequer and the Secretary of State for the Dominions will choose for these three Commissioners three of the ablest and most energetic, far-sighted men they can, but that they will attach to them a small band of young men with knowledge, with vision, and with a real determination to con-
secrate themselves to the development of that colony.
More than that, I hope that in one way or another something will be done to bring in new settlers. Ion will never get the agricultural development of that country if you leave it to the present people, with their limited outlook and with no stimulus from neighbours of a more go-ahead type. You may get some of them from Scotland, where the conditions are somewhat similar, and you may get others from Norway or Denmark-very good settlers they make, too. You want to bring into Newfoundland new blood, with a new outlook, and -if you do that, I believe the development of that country in the next few years may be something far greater than any of us have hitherto imagined. There again you will not be able to do it without a substantial loan. It is perfectly true that money has been wasted and squandered in the past on mistaken development, but that is no reason why you should not raise fresh money now and administer it for sound development. Indeed, without that, I do not believe you will ever get that development of the country that you must have, and from that point of view I hope my right hon. Friend the Chancellor of the Exchequer will be generous.
I am not sure, in passing, whether the money that has been and is to be given as a gift might not possibly have been put to a contingent or deferred loan, if our policy of development really enables the land to prosper, but I will not quarrel with my right hon. Friend on that point. In any case I hope he will put capital expenditure into Newfoundland and make it a different country from what it is to-day. My right hon. Friend will remember very well that when his father undertook a somewhat similar great responsibility in municipal affairs in the city of Birmingham, he said:
In 12 months' time, by God's grace, the city won't know itself.
If we take this business of Newfoundland in the right spirit and with the right men, I believe that in five years' time Britain's oldest Colony will not know herself. She will be no longer her oldest Colony, but in effect her youngest and one of her most promising Dominions. She has in addition to her own territory, assets of immense potential value in the 110,000 square miles of
Labrador territory, which contain vast resources of timber, enormous water power, and, in all human probability, vast mineral deposits. Labrador is a continuation of that pre-Cambrian rock shield of Northern Canada which is one of the most highly mineralised regions of the earth's surface and cne of the chief sources of Canada's wealth to-day. There is no reason why the Labrador section of Newfoundland should not also contain immense resources if it is developed. It may well be that the recommendation of the commission for a chartered company will be a most practical solution in view of the tremendous task already imposed on the Imperial Government in dealing with Newfoundland itself.
I entirely agree with my right hon. Friend when he said that this was an absorbing and fascinating task which we have taken in hand. It is a unique opportunity for the people of this country and for this country's leadership in the affairs of the British Empire. I confess 1 sometimes get rather tired when I hear it said on every hand that this country since the Conference of 1926 and the Statute of Westminster has abdicated its leadership of the Empire. It has done no such thing. The abdication of certain theoretical controls which have long ceased to be exercised, or which could not be exercised, is no reason for our abdicating our natural position as the leader, the power house, and the inspiring and driving force, from the point of view of human ability and effectiveness, of the British Empire. Therefore, I hope that we shall undertake this responsibility, heavy as it is, not merely as a matter of duty, but in a spirit of confidence and hope, confidence in ourselves and hope in the future of Newfoundland—in the spirit of words used long ago in this House—
elevating our minds to the greatness of that trust to which the order of Providence has called us.

5.33 p.m.

Mr. MAXTON: I do not propose to delay the Committee on this stage of the Newfoundland problem. I will keep what I have to say for the Second Reading of the Bill, because I think that what I want to say can be more properly said at that stage; and I presume the Dominions Secretary himself will be in charge on that occasion, and I should
prefer to deal with him rather than with the Chancellor of the Exchequer. The Chancellor of the Exchequer put the matter before us to-day in a very able way, but when the right hon. Gentleman, or the right hon. Gentleman the Member for Sparkbrook (Mr. Amery), or the hon. and gallant Gentleman who spoke for the Liberal party, bring in the sentimental plea in support of a case, I always get very dubious about the basic strength of their case, because all of them are very ready to rush in and wipe aside with a lordly wave of their hands the sentimental appeal when it comes from another quarter of the House. In this matter the Government are allowing their hearts, if I may be allowed to use the term, to run away with their heads, if again I may be allowed to use the term.
What is the cold proposition that is put before us? The cold business proposition is that we should assume the responsibility for a debt of £20,000,000 for creating which we have had no responsibility. The business assumption lying behind it is that some 60,000 wealth producers in a not too good corner of the globe—that is the reasonable estimate in a total population of 200,000; if I take just over one-third of that population as being wealth producers and the others as dependent wives and children, it is not an underestimate.

Earl WI NTERTON: The population is 285,000; the figure is in the Blue Book.

Mr. MAXTON: I say over 200,000. I will call it a little under 300,000, and I still say that 60,000 or 70,000 wealth producers is a reasonable estimate of the working population. I would say it is an underestimate if we assume that families are on the same scale as in this country, but the probability is that they will be larger. We are making this business arrangement on the assumption that these 60,000 or 70,000 wealth producers can, out of a relatively difficult soil and undeveloped resources, produce their own needs, their system of local administration, and the interest and principal on £20,000,000. I do not think that that is a sound business proposition. The assumption on which this loan is based is that Newfoundland can be made a regular El Dorado, that people can be persuaded to rush for this island when as a matter of plain fact, everyone who has watched the movement of populations here and in every part of
the British Empire knows that the tendency is for populations to move away from the primary industries, away from the remote parts into the big aggregations of population rather than 'for the big aggregation to move out into the more undeveloped parts of the world.
I cannot see any justification for assuming that, because we have taken on the burden of a loan of £20,000,000, there will be a wild rush of emigrants to Newfoundland, to a land which has a most disagreeable winter, and where they can only find as employment all the most laborious, arduous and dangerous kinds of work. The fishing industry at any time is a way of life which is surrounded not merely by toilsome labour, irksome physical conditions, but by great dangers. I can find no justification in assuming that there is going to be any great increase in population, nor for assuming that there will be a great influx of capitalists into Newfoundland looking for fields of exploitation. The right hon. Gentleman the Member for Sparkbrook says that they will develop their agriculture. May I ask what they are to grow? Our Minister of Agriculture is busily engaged in trying to increase our food production so that we will not have to import so much in the way of food as we formerly did, but we cannot import anythng like the fraction of the grain that Canada produces, or of the fruit that California or Australia or South Africa produce. Why tell the poor Newfoundlanders that there is a market for their agricultural produce?

Mr. AMERY: In their own Island. At present they import almost everything they need.

Mr. MAXTON: It says in the Report:
Each man is quite capable of building his house; the sea supplies him with food, both to eat and to sell; his little plot of land provides him with vegetables; the country side each summer is alive with wild fruits; and an occasional rabbit or duck adds variety to his fare.
Therefore, according to the Report, he is not importing all his food.

Earl WINTERTON: The hon. Member will see a table of imports which supports the case of my right hon. Friend.

Mr. MAXTON: I know that, but the total volume of those food products that
are imported do not make the basis for a great development of the agricultural life of Newfoundland. This fairy dream of the government for Newfoundland will be a necessity if the loan is not to become a grant just as the two temporary loans became; I was told in the House by the Dominions Secretary that they were loans, and I do not like the way in which these loans are turned in this White Paper into grants. The present loan will be turned into a grant unless—and the House in passing this Resolution ought to realise this—Newfoundland is turned into a highly successful wealth-producing island, which its past record gives us no reason for believing. We are to-day assuming the whole burden for the interest and the capital of the £20,000,000 involved. In order to do that, what are we doing? We are suspending local democratic government. Mark you, there is very little that is definite about this corruption in this Report. There are phrases all through about the corruption of local politicians and local politics, but there is nothing in the way of a definite charge; but if there has been corruption in the local politics, I would ask the Secretary for Dominion Affairs this question. The key point in Newfoundland government was the Governor—to a greater extent than in the case of the Governor in many of the Dominions, because he sat in the centre of the Cabinet. He had the position given him by the Crown here, but, in addition, he had a power almost similar to the power of a Prime Minister in this country. The Secretary for the Dominions shakes his head. I am merely basing myself on the Report. He is described as the Chairman of the Council, at which he presided. We have been sending Governors out there ever since there was a Newfoundland, and he has been in the centre of governmental control while all this corruption and all this debt raising has been going on.

Mr. AMERY: If the hon. Member will look rather more carefully at the report he will see that
the Governor presides at meetings of the Executive Council or Cabinet,
but
the work of the Council, however, is largely done by a committee or council consisting of members of the executive meeting under the chairmanship of the Prime Minister.
So the ordinary work is done by a body over which the Prime Minister presides.

Mr. MORGAN JONES: In another sentence it says that the minutes of the committee are formally approved by the Executive Council, presided over by the Governor.

Mr. AMERY: Formally!

Mr. JONES: Well, surely!

Mr. MAXTON: Let us assume that he has been what the right hon. Member for Spark brook suggests, merely, a figure head in doing his work. As chairman of the present Executive Council of 12 he could not prevent corruption in Newfoundland, and he could not bring about the stimulation of its industrial development. Now, as chairman of a council of six, he is to do all the things he could not do as chairman of a council of 12. I ask the Dominions Secretary whether the Governor under whose control this corruption has reached its peak point, and this disastrous condition of the Dominion's finances, is to remain as Governor in the new era of conservative finance and industrial, agricultural and fishery development. I am afraid that I do not keep myself au fait with the various Governors to the extent which I ought, because on more than one occasion I have had to deal as a Member of this House with situations in Dominions and Colonies where the Governor was a key person, but I am led to believe that the Governor is in this instance a retired Admiral of the British Navy. The right hon. Gentleman does not contradict that, so I assume that it is correct—that he has the breezy spirit of the quarter deck such as is bred in our bones. I do not know of anything in the training a man gets in the Royal Navy that fits him for handling a problem which is essentially financial and political, and therefore I want to know whether it is proposed that under the new scheme of government in Newfoundland the present Governor shall continue to be the Governor under the new conditions.
As I said when I rose, I do not intend to go into the matter fully at this stage, because I think the Second Reading of the Bill will be a more appropriate occasion to do so, but I consider the proposal now being put before us is a hasty and ill-thought out one. I ought to say here that on more than one occasion I com-
plained of the dilatory nature of the Commission's procedure. I thought that too much time was being taken up. Having regard to the very careful report that has been furnished and to the nature of the report, I must withdraw the reflections I cast at that time on the Chairman of the Commission. But I change my attack now, and I say that if the report was too slow in coming, the decisions of the Government on the report have been made much too hurriedly, and I am inclined to think that under the pressure of other very awkward questions with which they have had to deal the Cabinet as a whole have allowed the Dominions Secretary to have too much of his own way in this matter. He has taken what appears at the first blush the line of least resistance. It seemed the easiest and quickest way of preventing Newfoundland's insolvency, but if it is, as I think examination shows it to be not a prevention of insolvency but a postponement of insolvency, the hurry is not to our advantage. It would be far better if the Government took back these proposals and considered whether there were not better and more business like ways of not defaulting on the existing debt—of course I know it would be foolish to suggest that to the present Government—by redeeming that debt at its market value, to which it would fall very speedily if it were known among the investors of the world that the British Government did not propose to assume responsibility for it for all time. I say that is business, and this is sheer, silly sentimentality. The Government should come forward here with some proposal not for relieving bondholders and investors but for relieving the distress of the toiling men and women of that Dominion, whose labour and whose War services have been so well described by various speakers. Let them come forward with a proposal for relieving the distress of those people, the real population of Newfoundland, and I am sure that no part of the Opposition will put any difficulties in the way of such proposal being carried through.

5.55 p.m.

Lieut.-Colonel SPENDER-CLAY: The hon. Member for Bridgeton (Mr. Maxton) always appeals to the ear of the House, but he does not always appeal to its head. He has told us that what he has said is in the nature of a preliminary
skirmish, and that he has reserved his grand attack on the Dominions Secretary for the Second Reading of the Bill. I have listened with interest to the whole Debate, and especially to the speech of the Chancellor of the Exchequer, and I wish that I could concur in the proposals he has made for assisting the people of Newfoundland in their difficulties. I think the majority of Members in the Committee are agreed that some assistance should be given to the people of Newfoundland in their tragic condition, but I cannot agree with the proposals which the right hon. Gentleman puts forward. I would like to say that I agree with him that we owe a great debt of gratitude, as is recognised also by the hon. Member for Bridgeton, to the Royal Commission which produced this very illuminating report, and I suggest to the hon. Member for Bridgeton, in all humility, that it would be a good plan for him to read it a little closer before he attacks the Secretary for Dominion Affairs at a later date. It is a wonderful report, but at the same time a tragic report. It is sad to think that a self-reliant people, hitherto strongly individualistic, should by reason of a Government filled with a false optimism and through corruption which is almost, I should think, without parallel in the history of the Empire—in addition of course to the world depression—be reduced to the state in which we find them to-day.
It is only because I believe that the proposals of the Government, so far from clearing up the situation will aggravate the situation and not benefit the people of Newfoundland in the way we would like, that I must put forward objections to the scheme. The first objection is that it establishes a precedent which might be extremely dangerous. I was surprised to hear the Chancellor of the Exchequer lay down as a sort of thesis that could not be denied that under no circumstances should a trustee security default on its interest, no matter how badly the Dominion country may have been governed.

Mr. CHAMBERLAIN: The hon. and gallant Member is now putting words into my mouth which I did not say.

Lieut.-Colonel SPENDER-CLAY: Then, of course, I withdraw my statement. I
listened attentively to the right hon. Gentleman, but I am very glad to hear that he did not say that. I will take as an example what might have happened if Australia had had the precedent of Newfoundland before it. It is conceivable that in the dark days two or three years ago Australia might have expected assistance towards paying interest on her loans. If the various parts of the British Dominions feel that when in difficulties they can come to us and get gifts or grants-in-aid, we are establishing a rather dangerous state of affairs. The people of Australia, by their grit and determination to succeed, got over the greater part of their difficulties, and I feel that would not have been the case if they had had before them the precedent of Newfoundland.
The second objection is one to which I attach greater weight, and it is this: While an emergency exists, Newfoundland may acquiesce in what is ordained by the Commission appointed by the Secretary of State for the Dominions, and as long as the emergency lasts there will be no difficulty. As soon as the reforms are instituted, and it is apparent that the democratic form of government has disappeared altogether and the Commission begin to tread on the toes of the vested interests, there will be difficulties. When the Commissioners start purging the Civil Service, establishing a system of credit fishing and altering the inefficient marketing scheme which is at present in existence, the whole weight of public opinion will be against the Commissioners, who are made dictators over people who have hitherto been democratically governed.
My warning to the Government is that, in a year or so, the name of the United Kingdom will be mud in that country. Far from assisting in the proper development of the country, we are taking away their democratic government, which will end in disaster. Whether we like it or not, the drastic burden which has to be borne is going to affect practically the whole population of Newfoundland, from the highest trader to the poorest inhabitant. People do not like to he interfered with, especially by another Government, and that is the chief reason why I oppose these proposals.
My third objection is that it is not at all clear what sums are loans and what
are gifts. There is, of course, £17,500,000, which is the amount of loans that are to be recognised as trustee securities. It is a little difficult to appreciate exactly why these are chosen as trustee securities, and why we should discriminate between one form of security and another. I hope that before the Debate closes, the Financial Secretary to the Treasury will give us a dear answer as to what we are going to advance on loan, what is guaranteed and what is to be provided in the way of gifts. I cannot help agreeing with a number of the things which have been said by hon. Members opposite. We are piling up financial obligations on this country. It is always Great Britain that has to pay. There come bad times in the West Indies or a hurricane. Great Britain provides a grant-in-aid. There is a corrupt form of government; Great Britain has to step in and provide large sums of money by way of gifts, in order to put the country on its feet again.
I feel very strongly on this. While recognising the extraordinary gallantry of the people of Newfoundland in the War and their highly individualistic character in every direction, we should not forget that 50 per cent. of the imports into Newfoundland come from Canada, and that the majority of exports from Newfoundland are sent abroad in Norwegian boats. That is a small point, but I regret that Canada has not seen her way to come in also and help. It is only fair to recognise that the present Government in Newfoundland have undertaken a heroic task in meeting the difficulties; they have faced up to a situation, without the need having been imposed upon them from abroad. They have cut services to the bone to such an extent that, undoubtedly, fresh money will have to be provided. I do not want merely to criticise the Government's proposals without making alternative suggestions. It is very easy to criticise almost anything in this House, but it is extremely difficult to put forward alternative proposals.
With all humility I want to put forward one or two suggestions for the consideration of this Committee. The Chancellor of the Exchequer said that it was unthinkable that a British Possession should default. I say that we are defaulting. If they ask the bondholders if they are will-
ing to have their dividend reduced to 3 per cent., the Government, I maintain, are actually defaulting. I suggest that defaulting is not necessary. As a temporary measure, one could quite well take a token payment. We have heard of token payments before, and we pay a token payment to America at the present time. Why should Newfoundland not make a token payment of 1 per cent., or a of 1 per cent., to show her desire to resume payment? As things get better in Newfoundland, the conversion loan can be brought forward. A conversion loan would get over all the difficulties without defaulting, as I maintain is taking place at the present time.
Under the conditions which exist in Newfoundland to-day, it is only right that we should provide expert advisers to assist the Dominion Government in such matters as the social services, the organisation of the Civil Service and the development of national resources and marketing. I believe that advisers ought to be appointed, and likewise a Secretary of State ought to be attached to the Government. During the period that the advisers are in Newfoundland, grants-in-aid, at a low rate of interest, should be at the disposal of the Dominion Parliament for as long as they carry out the advice of the expert advisers. By so doing we should be governing by and through the Dominion Parliament, instead of allowing the Dominion to be governed arbitrarily by Commissioners appointed by a creditor nation.
I believe that this is a feasible proposition, and that there would be far more chance of co-operation between the people of Newfoundland and the Government, than under the scheme which is now proposed. As the result of the proposals put forward by the Government, the people of Newfoundland will be led to look upon themselves as poor relations, and that is a state of affairs which nobody likes, either as a country or as an individual. I dislike the idea of setting up an autocracy. The end of-democratic government is not yet reached. I dislike the idea of the Dominion Government giving up the position of a Dominion and surrendering its self-respect. It must do that, to the Government appointed by this country. It will not be in the interests of this country, because we shall not maintain the relations which have hither-
to existed between the two countries. For that reason, I find myself greatly opposed to the Government.

6.11 p.m.

Dr. WILLIAM McLEAN: I venture to intervene for a few moments, not as one who has any knowledge of Newfoundland, but having had experience of developing more or less primitive countries. Development, unless undertaken on proper lines, will get a poor result, and all steps should be taken to prevent that from the commencement. It is an axiom that development, to be economic under modern conditions, must be planned. That is to say, it should follow a programme, the extent of which is in conformity with a general plan of development for the whole territory. One of the main factors in Colonial development to-day is that of the market available for the produce of the territory. It is not sufficient to be assured that labour and capital are available for any potential production. Those are the economic principles, which, as we have seen, the Secretary of State is now applying to the development of the Colonies.
Neglect of the aspect of markets has led to a great deal of uneconomic development throughout the Empire. It must be recognised that a rapid expansion is now impossible in most countries. It was once possible, without deep study and coordination, to undertake works and developments with the knowledge that they were unlikely to result in serious financial disaster. A reference to the Report will show that a great deal of uneconomic development has taken place in Newfoundland. We ought to be cheered to read in paragraph 633 of the Report that it was desired to obtain advice from experts on various subjects such as forestry, agriculture, geology, communications, education, public health and presumably also in trade and markets. The Commission's Report states, on page 223, and in the same pararaph to which I have referred, that, following the expert reports:
we consider that the new administration should aim at the formation of a plan, extending over a period of years, which will not merely consolidate the progress achieved under its direction but will lay the foundations for the gradual building up of an economic structure.
In the practical working out of this recommendation, a point which is often
overlooked is the necessity for coordinating those expert reports in the form of a general economic programme for the country. In a specific case, in my own experience, the reports and programmes, submitted by the public health and education authorities, were worked out in all their implications. We found that they would have absorbed most of the revenue available to the country.
Again, in mast of these more or less primitive countries it is found that the roads and the railways are under separate departments, and I think that that is the case in Newfoundland. The tendency has been to construct the roads along the convenient alignments of the railways, so that they are in competition with the railways instead of being laid out as feeders, and the result is that the railways become a heavy burden on the Government. An example of what appears to be uneconomic development of this sort is shown on Plan No. 4, attached to the Report. That is a plan of the roads, and it shows that it is proposed to construct a road from Corner Brook to St. Georges, running alongside the railway for about 40 miles. Unless there is some exceptional traffic circumstance, which the report does not indicate, the making of this isolated piece of road would certainly result in a further impoverishment of the railway. This, of course, may appear a small item, but I estimate that the capital expenditure involved would be between £300,000 and £500,000, and that maintenance charges would be between £5,000 and £10,000 a year. That is something considerable in a small country. I have ventured to call attention to this matter because the report does not seem to make at all clear the necessity for a wide co-ordination in preparing the development plan and programme which the Commission recommend.

6.17 p.m.

Earl WINTERTON: It seems to me to be obvious from this Debate that there are questions which require to be answered by the Government. Although I speak from the point of view of one who is going to support the Government on the Resolution, certain very important questions have been raised, not, if I may say so, from a wholly party point of view, from both sides of the House. I do not
agree with the criticism put forward by one hon. Member who spoke from below the Gangway opposite, that this proposal has been rushed through. I think, in view of the nature of the report which has been made by the very competent Commission who went out to Newfoundland, that it was necessary that action should be taken; but I hope that my right hon. Friend the Chancellor of the Exchequer will not think it impertinent if I say that in his speech he did not, perhaps, deal as fully as was desirable with all the aspects that arise in connection with this matter.
There is the question whether, if you go to the succour of Newfoundland, that is to be taken as a precedent for going to the succour of any similar Colony or Dominion. Of course, although in status Newfoundland is a Dominion, in point of economic value it is more equivalent to a Colony. I do not suggest that the Government should give this answer now, but, in putting this proposal before the Committee, they should, if I may say 30 to them, be very clear in their own mind that what they are doing may be taken as a precedent by future governments in similar circumstances. That is the first consideration which I would put forward. In the second place, I wish to say that I heard with a good deal of sympathy the remark of the hon. Member for Rothwell (Mr. Lunn), that Great Britain was providing money for every sort of object all over the world. That is indeed very true. Whether it be in the case of the League of Nations, or whatever it is, it is always Great Britain that is called upon to pay, although Great Britain is the most heavily taxed country of any. Therefore, while I do not in any way oppose the charge which we shall put upon the taxpayer in this Resolution, do think that the Committee, before parting with the subject, should be very careful to see that what is laid down in the Resolution is in the best interests alike of the taxpayers of this country and of Newfoundland.
The hon. Member for Bridgeton (Mr. Maxton) made a statement which, I think, will find a sympathetic echo in the heart of everyone in the House when he said that, if you are going to incur this financial liability, the interests which you have to consider primarily are those of the people of Newfoundland—that the wage-
earners of Newfoundland are far more important than any of those who have lent money to Newfoundland. I am not competent to discuss the matter which was raised by my right hon. and gallant Friend the Member for Tonbridge (Lieut.-Colonel Spender-Clay), when he referred to certain suggestions which he said were not necessary from the strictly financial point of view, but obviously first and foremost we have to consider the interests of those hard-pressed people in Newfoundland who are either wage-earners or at any rate are living by their own efforts, though they may not receive daily wages. In addition, and here I follow entirely the line of my right hon. Friend the Member for Sparkbrook (Mr. Amery)—we have to consider also the interests of the people of this country. If it be true that there is room for very considerable economic development in Newfoundland, that economic development should be carried out on the basis of, firstly, the interests of the people of Newfoundland, and, secondly, the interests of the people of this country. I say quite frankly that those who are paying the piper should call the tune, and that is why I said I had some sympathy with the hon. Member for Rothwell when he said that we were always called upon to pay.
I do not want to appear in the guise—a most objectionable one—of the candid friend, but no doubt the Government will recognise that, at a time when they are finding it very hard to provide money for many things in this country, they will have to answer a case on the platform and elsewhere on this Resolution, and they ought to be extremely careful that they have a good case. One of the things that they will be asked is: "Is it really necessary that you should incur this very considerable obligation? Could not the actual financial obligation resting upon the shoulders of the taxpayers of this country be reduced in some way? "I suggest to the Financial Secretary to the Treasury, who, I understand is going to reply, that two things should be made clear from the outset. The first is that we are entitled to be repaid out of the revenues of Newfoundland the money which we actually loan as soon as those revenues are in a position to repay it without placing an undue burden upon the hard-pressed people of Newfoundland; and the second is that the money should be loaned on a long-term policy
of economic development. As my right hon. Friend the Member for Sparkbrook said, it is no use saying that, immediately the country is in a fairly good financial state, we are going to hand back the Government to the very people who have mismanaged it for the last 25 years. I do not think that any politician who has been a Member of the Newfoundland Legislature would, if he were present in this House, say that he could stand in a white sheet as regards this matter. It is a terrible story of more than a generation of gross mismanagement, to call it by no other name, and, if we are going to undertake this heavy responsibility And create a precedent, we have to be assured that the Government is not going to be handed back to those people until conditions have vitally changed. I think it is most necessary that the scheme of development should be carried out on the lines indicated by my hon. Friend the Member for Tradeston (Dr. McLean), who has had so much experience in other parts of the Empire.
Another question to which I desire to refer is that of the form that this development should take. The Chancellor of the Exchequer did not deal very fully with that question, and no doubt quite rightly; it would perhaps be better dealt with on the Second Reading of the Bill. It is clear, however, to those who, like myself, have closely studied the admirable report of the commission, that there is room for very considerable development in a number of directions. First of all, there is the question of the export trade in canned salmon and things of that kind. Some of the money which we are going to be responsible for loaning or giving might be used in trying to develop, not necessarily through Government action, but through organisations for which the Government is responsible, trade of that kind. In the second place, there is the question of agricultural development. Much of the agricultural land in Newfoundland is just as suitable for cropping as a great many areas of the Highlands and Islands. It is true, as the hon. Member for Bridgeton pointed out, that the general tendency is for people to leave the more isolated parts of this country and of the Empire. That is true of Scotland. People leave the Highlands and Islands and come South or emigrate. But
it is not true of Newfoundland to-day. In fact, the Report shows, on the contrary, that, so difficult are conditions on the American Continent, in Canada and the United States, that people have actually come back to Newfoundland, which, having an enormous birth-rate, is in a different position from Scotland in that the increase of population is very large. Is it not possible to settle some of these people on the land? My right hon. Friend referred to the fertility of the soil in some parts of the island. I have some pictures which he has lent me, taken by Sir Wilfred Grenfell, of the land which he has developed in the North of Newfoundland; and, judging from these pictures, very fine crops and stock can be produced in those parts. I hope that there will be development of this kind
Then there is the question of the export of ore to Great Britain. That is a matter which could be dealt with through the agency of Government organisation. Again, there is the organisation of the fur industry, which is alluded to in the Report; and, of course, there is also the question of paper. In this regard I think a tribute is due—it has not been given in the Debate so far—to what are commonly known as the Harmsworth interests, to the late Lord Northcliffe and the present Lord Rothermere, for the magnificent development which has been carried out by the Anglo-Newfoundland Development Company, where the conditions of the workmen are far superior to anything that has been known in Newfoundland, and probably as good as any on the whole American continent. Is it not possible to budget for development of that kind? There is another question which is referred to in the Report, but which has not been mentioned this afternoon, and that is as to whether some of this development might not take place in connection with recruitment in Newfoundland for the Royal Navy. Newfoundland has always been a great recruiting place for the Navy, and its Royal Naval Reserve gave a magnificent account of itself in the War. The Report suggests that steps should be taken to re-open that recruitment, and that one of His Majesty's ships should be sent there. I hope that all these questions are being taken into consideration.
I have no objection to the Dominions Office being responsible for the supervision
of this—I do not quite know what to call it, whether it will be a Colony or what it will be; let us call it an Empire country. It must be recognised, however, that the Dominions Office has not the same expert knowledge as the Colonial Office, which deals with a number of territories all over the world which are in the sort of stage of development in which Newfoundland is. I imagine that this proposal is not going to be considered merely as a mechanical device for restoring the finances of Newfoundland; I hope it will be regarded as a device for developing the country.
I have only one further thing to say in supporting the Resolution, and that is as to the reason why, apart from anything else, it is so important that we should have regard to the potential development of the country. Every time I travel in Europe, as I do fairly often, I am convinced that there is a growing resentment in European countries at the way in which Great Britain and the Empire sprawl over half the world, and do not develop 10 per cent. of the resources which they own. How are any of us to give an answer to this question which has constantly been put to me and, no doubt, to others by foreign friends? Here are we, confined in our little country, with no chance of emigration, because the United States will not have us, while the British sprawl over half the earth and do nothing to develop it. It is not easy to give a short answer to that question, nor is it easy to give a short answer to the unemployed than in South Wales mentioned in a recent Debate who has no chance of getting work in his own district. What are you doing with all these great Dominions and what are the Dominions doing? Here we have a chance, not a big one, but we have a country that is undoubtedly capable of expansion. I believe we could within the next three or four years, if times improve, find profitable employment for the existing population and eventually we could get a small migration into the country. If it were only 5,000 or 10,000 a year it would help, and anyone who went from this country could not go to a part of the Empire more thoroughly British in sentiment. For 400 years these people have battled against the elements in a way worthy to compare with the magnificent record of the fishermen and seamen of this country. I hope the Government will approach this matter in a large spirit,
and with a determination to make a success of this scheme, which can be made a success if approached in the right manner.

6.32 p.m.

Mr. McENTEE: I take it that I, like other Members, will have to give some reply to the question which will undoubtedly be asked of all of us who address public meetings: why we cast the vote that we are about to cast. If we are frank, we shall have to say to the people who are pressing us that it was stated by the Chancellor of the Exchequer that a debt approximating to £20,000,000 has been run up in a Dominion to which we owe very little except perhaps that it is our oldest Dominion and that during the War its small population contributed as large a share as any other Dominion or any other nation engaged in the War. The debt has been created by what the Chancellor described as vicious and corrupt political practices, and it is due to a set of people, again quoting the Chancellor, who live in various parts of the world including, of course, Great Britain. These foreign financiers who from time to time came to the aid of the Government that desired to borrow the money presumably made no adequate inquiries in regard to the securities offered to them and, as a consequence, they found out nothing of the corrupt practices which had been going on over a long period of years. The time came when discoveries were made which told all the world that the securities that they accepted were of very little value. To quote again from the statement of the Chancellor, either we had to come to their relief or they must default. I am asking, therefore, why should we alone come to their relief. I have often heard it said that we are one of a group of countries which have come together and call themselves the British Empire, and that we are all co-equal within the Empire, but at all times apparently, when anything goes wrong and when some financial provision has to be made for some other part of the Empire, the Mother Country has to look after her children and has to pay.
I have not heard any adequate reason why the people of this country, who are more heavily taxed than those of any other part of the Dominions, are alone to come to the assistance of one of the smaller Dominions when a financial crisis
arises. I do not think I can give any answer, and I do not think any hon. Member could give any answer which would satisfy any reasonable person as to why we alone must meet the defaulters. The Chancellor told us something of the liabilities, but not very much. He was very guarded. The Dominions Secretary told us a little time ago, when the loans were being made that the Chancellor mentioned, that they were nothing but loans, but a few months later he comes back and says, through the Chancellor, "They are not loans, they are gifts," and in fact we have to give these people the money that we lent them a few years ago. If we are to judge by that experience, is there any real meaning why the whole of this £20,000,000 will not have to be treated as a gift? I think we ought to say to the people who ask us these questions that it is a gift and that we will settle the whole thing by paying it up and, at any rate, we shall have this to our credit, that we shall not have to continue to charge interest year by year if we pay off the whole of it in a lump sum under the best conditions that we can make with the people to whom the money is to be paid. But, after all, why should we pay it at all? No one on this side and I do not think anyone on the other side would raise the slightest objection if a loan was raised, the interest to be paid year by year, or a lump sum was paid to the people of Newfoundland to enable them to get over their temporary difficulties and to keep a reasonable standard of living for the people there. But that is not what we are asked to do. We are asked to come to the aid of a number of financiers in all parts of the world who incurred a bad debt. I have not heard anyone tell us why we should do that.
The only reason is that offered by the right hon. Gentleman the Member for Sparkbrook (Mr. Amery). I was wondering if he was speaking with his tongue in his cheek when he got so enthusiastic about those noble fellows who came during the War and only 60 or 80 went back out of 800 or 900. You can parallel that in hundreds of instances among our unemployed here. You can parallel it in almost any of the regiments in our own Army, and in certain parts of the country, at any rate, they are just as badly off as they are in Newfoundland. If we raise
the condition of these people we are told it is sob-stuff. It is the ordinary sympathy of any ordinary person towards his fellows. If these people are as distressed as the right hon. Gentleman says they are—I have no personal knowledge of it, but I accept his word—I agree that we ought to come to their aid, but how much of this money is going to them? Will their condition three or six months from now, as a consequence of our voting for this Motion, be one whit better than it was, say, six or 12 months ago? Everyone knows that it will not be any different at all. They will still have to struggle on. They will still have the poor, mean existence that they have probably had during the greater part of their lives, and the £20,000,000 loan that we are guaranteeing will riot in any way aid them except to continue the hard struggle that they have to get their ordinary living at any time.
What are we going to get out of this? I have not heard a suggestion from anyone as to any kind of repayment that is to come to this country. I can imagine the Prime Minister, if this matter had arisen four years ago, telling us, it was a very fine opportunity for giving effect to the Socialist theories that he believed in then. I can imagine him saying, "If we have to put money into this country to develop its resources, to pay its debts or to meet its responsibilities, we ought to have something in return, and certainly, if the country is to be developed, it ought to be developed by capital from this country, and any return from the investment of that capital ought to come back to the nation which is responsible for its payment. The Prime Minister would not, of course, take that position now. I can imagine the Chancellor of the Exchequer, if the Government of Newfoundland had been a Labour instead of a Tory Government, telling us a great deal about the essential corruption of Labour Governments. I have been wondering what would have happened. I remember what did happen when we were discussing Poplar and West Ham. The population of West Ham is probably greater than the population of Newfoundland, and the people concerned in that instance were not strangers, largely foreigners, but our own people, many of them suffering just as intensely as any one is suffering in Newfoundland to-day. There was no corruption in West Ham.
It was suggested that there were practices which should not have taken place, but no one suggested corruption.
Nobody in this country will get anything as a result of the £20,000,000 which is to be given away. Nobody in this country will be one whit better off in consequence of having voted for it, but every taxpayer in the country will be considerably worse off in consequence. I am convinced that if the people of Newfoundland were in difficulties, and it meant the saving of the people from hardship, the £20,000,000 would not be voted, and the Government guarantee would not be given. But the bondholders—perhaps a good few of them are in this House—must not be allowed to lose their money. Their money must be guaranteed. The people in this House who are themselves bondholders and their friends will make this guarantee to their fellow-bondholders. It is done every day. It was done in the case of Austria. It is to be done now in the case of Newfoundland, and it will be done in every case where the interests of the bondholders are at stake. The remarkable thing about it is that you get away with it so often, and that the people of this country tolerate it. They, no doubt, tolerate it because, generally speaking, they do not care. They are not very much interested; they are a bit sick of things. They are tired of politics, and tired of their penury and privation. I hope that it will he considered the duty of everybody in this House and of every decent person in society to inform all the people of this country that their money is being given away, not for the purpose of saving the starving people of Newfoundland, but for the purpose of preserving the interests of the people who have invested money there. I shall take every opportunity of pointing out what the Noble Lord the Member for Horsham (Earl Winterton) has pointed out, namely, that it is nearly time the National Government and all other Governments took a little more interest in their own people at home, and a little less interest in the people of other countries.

Earl WINTERTON: I hope that the hon. Member will not attribute a remark in that sense to me. That was not what I said: that was not the effect of it.

Mr. McENTEE: I do not think that I am misrepresenting the Noble Lord when
I say that he said that the Government were very interested in looking after the interests of people in other parts of the world instead of looking after our own interests.

Earl WINTERTON: No, I did not say that. I said that the British Government sent money all over the world. That was all I said. I did not say "this Government."

Mr. McENTEE: The Noble Lord gave me, and, I think, everybody else, the impression that when they sent money all over the world it was for some purpose. Perhaps he will be good enough now to tell the House the purpose. I am merely assuming—and I think rightly—that the purpose in this case is to help people most of whom, probably, are foreigners. It is nothing to the credit of this Government, or to this House, if certain people, acting criminally, lose their money and the loss of that money has to be borne by somebody, that we should impose upon our taxpayers the obligation of meeting that loss, so that certain people, many of them perhaps as criminal as those held to be responsible in Newfoundland, should be guaranteed against any loss at all. I am glad of the opportunity to vote against this Motion and of being able to tell the people generally-in the country that it is a ramp on the part of the Government, an interested Government, a Government representing, in this country and in other countries, the bondholders and the interest-mongers generally, to see that as far as possible their class is guaranteed against loss. At the same time they cannot afford anything like the same treatment for the unfortunate people in this country whom they ought to help.

6.50 p.m.

Mr. BUCHAN: I do not agree with very much of the speech of the hon. Member for West Walthamstow (Mr. McEntee), but I agree most cordially with him in one thing. I want, if we-make a loan, to see the money repaid. Therefore, I want the Government's policy to be a success and Newfoundland to become a prosperous country. I should like to emphasise a point which was made by my Noble Friend the Member for Horsham (Earl Winterton) and by my right hon. Friend the Member for Sparkbrook (Mr. Amery), and which
is referred to in the Royal Commission's Report. I most sincerely hope that His Majesty's Government will not be content with merely putting the finances of Newfoundland straight and remodelling and reforming its political system, but that it will go further and encourage real development. Hon. Members opposite take a gloomy view of the future prospects of our policy. I think that its failure or success depends not upon the bare lines of the Bill but wholly upon the spirit in which it is applied.
There is one particular point which I may be allowed to bring to the notice of His Majesty's Government, one particular form of development—the need of encouraging the formation of that scientific apparatus without which true development is impossible. We all say, it is a platitude, that the future of most parts of the British Empire depends upon the proper use of applied science. That I believe to be profoundly true, but Newfoundland, our oldest Colony, unfortunately, has never been in a position herself to provide that apparatus. Her eggs have been in far too few baskets. Her society has been too undifferentiated and undiversified. She has simply not been in the position to create the kind of development machinery which is far more important in the long run than political institutions. Take, for example, her fisheries, the main means of her livelihood. It was only, I think, last year that, under the auspices of the Empire Marketing Board, a marine biological station was established in Newfoundland. I do not believe that there is any finer race in the world, hardier and more courageous than the Newfoundland fishermen, as anyone knows who has been there, or who saw that wonderful Newfoundland contingent in the Battle of the Somme. But they have never had a chance of having modern science applied to their main industry. Their methods are still hopelessly out-of-date. The same thing is true of other interests. The agricultural potentialities, and the pastoral and mineral potentialities of the land have never been properly studied, although I was very glad to hear the tribute paid by my Noble Friend that its forest wealth has been admirably developed by private companies. A large part of Newfoundland is still to-day unknown. I under-
stand that a larger proportion of the island is unsurveyed and unmapped than of the continent of Africa.
The reason why I have risen is to emphasise and to remind the Government of what I believe to be a very valuable precedent, and one to which my right hon. Friend the Member for Spark-brook has also referred. After the South African War, the Transvaal and the Orange River Colonies, so far as their rural parts were concerned, were practically in the position of Newfoundland to-day. They bad an undiversified society, and they were simply not capable of providing themselves with proper apparatus for development. Lord Milner, with whom at that time I was associated—I was one of what my right hon. Friend called "his young men"—alas ! to-day no longer young; I did not even belong to the kindergarten but to an earlier vintage called the Creche—took a very wise and far-sighted view. He realised that both the risks and the handicaps and potentialities of South African farming were practically unknown. So he collected experts up and down the whole globe, from Britain, from America, and from other parts of the Empire, experts in different forms of agriculture, bacteriologists, experts on pasture, on fruit, on tobacco and on irrigation. There was a tremendous row. We were accused by the urban interests, especially the goldmining interests, of squandering money, and the rural population, for whom these things were done, being stubborn Conservatives, regarded the whole thing as folly. But very soon the wisdom of that policy was proved. Presently came the great epidemic of East Coast fever, and but for these scientific departments the whole cattle stock of the Boer farming population would have been absolutely destroyed. I remember General Botha telling me just before the Great War that the Boer farmer would give up anything rather than those scientific departments which he had begun by doubting, but which he had learnt by experience to be of profound practical value.

6.58 p.m.

Mr. MORGAN JONES: I care not whether the hon. and learned Gentleman the Member for the Scottish Universities (Mr. Buchan) belonged to the Cr´che or the Kindergarten, but I am sure that most of us who have read his novels will
agree that he has arrived somewhere now. Much as I admire his efforts in disclosing to our view the stirring past, I find them much more safe as a guide than I find his speeches in this House. The Chancellor of the Exchequer in introducing this subject said, and, I think, rightly, that the two aspects of this problem to which the White Paper directed our attention, namely, the constitutional and the financial, are so inter-related that we cannot very well divorce the one from the other. I should like on that account to make some observations upon the constitutional side which is raised for us on account of the Resolution which we are considering. There is a matter of very great substance involved in this constitutional change. We are a people who believe in democratic government, and when we are required on any grounds to agree to the removal of the forms of democratic government, we can only endorse such a proposal if the arguments in its favour are overwhelming.
Not only are we as a party devoted to democratic sentiment, but there is no doubt truth in the assertion that the people of Newfoundland themselves would attach the very greatest possible importance to the fact that they had been hitherto a self-governing Dominion. Whether they should have been a Dominion at all is another matter. It may seem to he a foolish thing to call a country a governing Dominion when it only consists of some 280,000 population. But they have been a self-governing Dominion. Now there is a suggestion that in the future the Governor should, as it were, go into Commission and be assisted by some six commissioners, three British and three Newfoundland. In place of the democratic form of government that has prevailed hitherto, there is undoubtedly to be a form of government exercising, so far as the people of Newfoundland are concerned, absolute authority, and that absolute authority will last for a period of years —no one knows quite how long. Self-government is given up completely, and suggest to the right hon. Gentleman that it is a tremendous set-back to the principle of democratic government within the Commonwealth to put forward a proposition of this sort at this time of the day.
I cannot believe that the Government would deny that underlying this proposal is the assertion that self-government as we have known it in Newfoundland has completely broken down. I am not quite sure that I should agree with that as a simple proposition. There have undoubtedly been failures—tragic failures—and for directing our attention to them I associate myself with those who have paid deserved tribute to the Commission who have presented this very courageous document for our appraisal. But the question is: has this failure arisen on the part of the people themselves? Is it fair to tell the people, "There has been failure within your country on the part of the Government, and because of that failure we are going to withhold from you for a certain time all the functions of self-government?" That is a big proposition to put forward, and before you invite the people of Newfoundland even to contemplate it you must prove that the failure arises not from the Governor, not from the legislature, but from some inherent failure in the people themselves. I submit that that takes some proving.
Before, however, I come to that point I want to return to the point which was put, quite properly, by the hon. Member for Bridgeton (Mr. Maxton). What about the Governors of the past and their share in this matter? From time to tune Governors living in Newfoundland, acting on behalf of this Government, have been in constant touch with the Government of Great Britain. Have they never informed the Government of Great Britain of this state of deterioration in the public services? Has no Governor at all called the British Government's attention to this gross mismanagement? Have they been entirely dumb all these years? If so, it is about time that someone was called to book for failure to draw attention to the dreadful deterioration which has obviously taken place.

The SECRETARY of STATE for DOMINION AFFAIRS (Mr. J. H. Thomas): The late Under-Secretary for the Dominions the hon. Member for Rothwell (Mr. Lunn) must have forgotten that there was an investigation by a Government into Newfoundland a number of years ago.

Mr. JONES: I will come to that presently, if I may, except that I should
like to say that I am not acquainted with the terms of any findings that arose in consequence of that inquiry.

Mr. THOMAS: I am sure you are not.

Mr. JONES: I would, however, say that if it be true that previous Governments or this Government have been made acquainted with the steady deterioration in the governmental machinery of Newfoundland, then clearly the responsibility upon this Government to consider with circumspection any suggestion of floating a new loan was all the greater on that account. If in the face of that evidence our Government allowed loans to be floated deliberately and knowingly, that is, with the knowledge of maladministration in their possession, their responsibility is very great.
Turning to the responsibility of the legislators, we are not now considering the operations of a Labour Government; we are not even considering the operations of people who have Labour sympathies. I may remind hon. Members who are opposed to self-government for India that we are not even discussing the failure of Indians. We are discussing the failure of people of our own flesh and blood. I say quite deliberately to the right hon. Gentleman that there is ample evidence in this Report to justify us in asking what judicial action is being taken in regard to these people who have been so shamefully negligent of their obvious duties Warren Hastings was impeached by this House on far less evidence than would be available in the case of some of these people. I will make another observation which does not concern the Government at all: the religious denominations of that country deserve the severest censure for their share in this business. Those who stand for moral principles in private life ought not to be absolved from being expected to stand for decent principles in public government as well. But, seeing that the right hon. Gentleman himself at the beginning of this year appointed this Commission to inquire into this matter—and I think I am right in saying that a. request was also made by the Legislature of Newfoundland after the general election for an inquiry—in any case, seeing that an inquiry had to be embarked on,
how comes it that our own Government allow another loan to be made to these people after the inquiry has been set up?
It is not fair to suggest to these people as a whole that they have failed. There has been failure, but it has been mainly on the part of people who have been officially responsible for the governance of that country. Moreover, I ought to say in partial defence even of the legislators, as well as of the people, that all the trouble is not theirs. They have undoubtedly been confronted with disasters on account of the failure of Nature herself. But they have not learnt their lesson from experience at all; they have just gone on as though nothing bad happened in any way. I ask the right hon. Gentleman whether, supposing that we take the action which is suggested to-night and that the new Commission lasts for 10, 15 or 20 years—call is x years—what guarantee is there that at the determination of that period the people of Newfoundland will be any more deady to conduct government efficiently than they are now? In the meantime they will have no experience of government: it will all be withdrawn from them. They will not even have local government, but will have the machinery of government completely removed from them for a given period of time.
Secondly, will not our action in putting in a Government of our own tend somewhat to increase the measure of their reliance upon us? They will tend to say, "Never mind, if we get into a hole the Home Government will get us out of it; they will put in a Commission, as they did in 1933." It is therefore a bad thing for them that for a given period they should be entirely removed from the scene of actual self-government. Lastly, you ought even during this period, however long it may be, to continue as closely as possible the actual association of the people with whoever may be responsible for the Government during this interregnum, be it short or long. But to cut them off completely is an exceedingly bad stroke of business. I will leave this side of the argument with the remark that for our part we take the strongest possible exception to this retrogressive action in this matter of Dominion self-government.
A word or two about the financial side. Some surprise was felt—why it should
have been, I do not know—at the strength with which the hon. Member for Rothwell (Mr. Lunn) spoke from our side during the discussion. We have come to the conclusion that the time has 'come to cry a halt to this habit of lending or giving money from time to time to various parts of the British Dominions. I have no objection to having a business relationship with them; I am prepared to work with them as heartily as possible, but we ought not to allow them to come to the conclusion that it is our job from time to time to get them out of the difficulties which they themselves have created. We take heavy responsibility for these people already. Enormous responsibilities are taken financially to safeguard them in the matter of defence; that is not a small contribution in itself. We have extended vast loans to various parts of the Empire and in various ways, and that is a heavy responsibility.

Mr. J. H. THOMAS: What Government loans?

Mr. JONES: The right hon. Gentleman knows that from time to time we have given financial assistance, sometimes by grant and sometimes by loan.

Mr. THOMAS: Tell me one instance. It is important to know to what Dominions we have given a loan.

Mr. JONES: The right hon. Gentleman knows that there is a Colonial Development Fund through which we extend assistance in one way or another to this or other parts of the Empire. That is fact which everybody knows. There must be a time when we must cry a halt to this habit. We have had some rather curious instances of financial aid given to various parts of the Empire since the War. Let me mention one or two just to remind the right hon. Gentleman, who, I see, is not interested in the matter, though possibly he will listen to me. Take the case of ' Nauru. An agreement was entered into between the late Lord Milner and Mr. Hughes in regard to Nauru phosphates. That has gone on for years. We invested vast sums of money there. It is true that we get 6 per cent. return on our money, but our purpose was not to get a return on our money but to get phosphates, and we do not get one cart, load. We cannot get our money back. It is locked up there. That is one instance, and there are others. The
Empire Marketing Board gave money in one form or another. That may be defensible from some points of view, but there must be a point at which we must cry a, halt and make it clear to these people that it is impossible for us to continue bearing the burdens, when we ourselves are in the middle of great financial distress.
In regard to this particular proposal we are told that the alternatives are either default or the method proposed in the White Paper. I admit that there is overwhelming evidence of grave breakdown, but it is not strictly true, as the right hon. Gentleman suggested, that these people are all as poverty-stricken as he implied. I know that there is great poverty, and I regretfully admit it and that these people are very hard-hit. But let us face facts. The report of the Royal Commission tells us that they have on deposit in the banks at this moment 26,000,000 dollars, and they will not touch one penny of it, because of the tradition in their home circles that once a parent has invested so much money in the bank it is almost more than he dare do, because of the strength of the tradition, to withdraw it. He must leave it to his children. I should like to think that my people in South Wales and in my constituency had 26,000,000 dollars, or the equivalent of that sum. I should like to think that my people will have on an average 100 dollars per head in the bank. If they had, the Government would quickly apply the means test in this country to make them disgorge as soon as possible.
The people in Newfoundland pay no rates, but in my part of the country the rates are 20s., 22s., 24s. and 26s. in the pound. The Newfoundland people can acquire for themselves various resources, as the hon. Member for Bridgeton pointed out, from the countryside around them. Not only so but the Joint Committee of the Legislative Assembly reported in 1880 upon the very substantial natural resources of the island. They were then anxious to have a railway built. We have been told that democracy, almost inevitably, is associated with misgovernment. Can the hon. Member who made that statement recall to me any example of democratic government presenting such a disgraceful story as the story of the Reid contract in 1894?

Mr. AMERY: Surely that was democratic Government?

Mr. JONES: It was an example of plain and unashamed Imperialistic exploitation, and nothing more. Land was given away; 5,000 acres of land were given to the contractor for every mile of railway he completed, and the result was that he finished up with over 2,000,000 acres of land to his own credit and in his own possession. Land has been given away until now there is scarcely any land available for the Government anywhere inside the three miles limit all round the coast.
Hon. Members know that the responsibility for much of the chaos in Newfoundland to-day, grave as it is, is not due directly to the people of Newfoundland but to the people who have utilised the machinery of government for their self-aggrandisement. Take the loans themselves. On page 43 of the Royal Commission's Report we find this story:
The last 12 years, during none of which was the budget balanced, were characterised by an outflow of public funds on a scale as ruinous as it was unprecedented, fostered by a continuous stream of willing lenders.
This constant stream of willing lenders now find themselves in difficulties, and they bring the hat to us and invite us of our generosity, and in a kindly way, to make a contribution to rescue them from their difficulty. Take the loans, excepting our own Government contributions, that have been made recently. They have been through Canadian banks—four of them. We are told in the report of the Commission that not 5 per cent. of the public debt is owned by the people in Newfoundland. The whole purpose, therefore, of the Government's proposal is to come to the aid of people who own 95 per cent. of the public debt of Newfoundland, and who live outside the island. Why should we do that? It is the Canadian banks that are involved. Why cannot Canada do something? Why cannot the countries that own the bondholders make a contribution? Why must we, if I may adopt common parlance, hold the baby? It is because we have encouraged these people, not deliberately, not intentionally, but by our previous generosity, to imagine that in the long run Britain would come to the rescue.
I cannot see that an adequate case has been made out for our shouldering this burden. Our own unemployed are as badly hit as large numbers of these people, and I cannot believe that there is an adequate case for foisting this financial burden upon our own poverty-stricken people, for that is what it will amount to. When the Budget comes along next year there will be a demand for a reduction of Income Tax, and, on the other hand, there will be a demand for more indirect taxation, and in that way the ordinary man will be called upon to pay. I cannot see why anyone in this country should be called upon to pay a debt which those responsible, with their eyes open, have allowed the Newfoundland people to incur. I do not know what view the Canadian Government will take regarding Labrador. In a report of a discussion which took place in the Newfoundland Legislature the question of Labrador was raised, and someone suggested that Labrador might be sold to Canada for 110,000,000 dollars, but the Prime Minister of Newfoundland said that if Labrador belonged to him he would not sell it for 200,000,000 dollars. Clearly, Newfoundland is not going to be able to develop Labrador; she cannot develop her own resources because she is so poverty-stricken. Therefore, we ought to ask Newfoundland to see whether the Labrador territory could not be sold to the Canadian Government so as to relieve us from being called upon to come to the rescue in the distressing financial situation in which Newfoundland finds herself.
I think I speak for every Member of my party when I say that we have the strongest possible objection to the principle involved in the Bill. We object to taking away the right of self-government from the Newfoundland people, that is to say, we object to the constitutional policy involved, and we must strongly object to the financial implications contained in the Resolution.

7.26 p.m.

The FINANCIAL SECRETARY to the TREASURY (Mr. Hore-Belisha): I see in the hon. Member who has just sat down, unlike the hon. and learned Member for East Bristol (Sir S. Cripps) who sits beside him, a sound defender of constitutional principles, but from the remarks that he has made one gathers that he would desire to repudiate the New-
foundland national debt. I am not in the least surprised at that, because that would be a small item in the hon. Gentleman's programme, which, as we are reminded in Budget Debates, would repudiate the whole of the British national debt as well. Perhaps the wisest and truest statement made in the course of the discussion came from the Noble Lord the Member for Horsham (Earl Winterton) when he said that the case which the Government would have to meet in regard to this matter was not the case presented here but the case that will be presented on the public platforms.
Having listened to the hon. Member for the Rothwell Division (Mr. Lunn) and the hon. Member for Caerphilly (Mr. M. Jones), I have no doubt that the electorate will be told that His Majesty's Government are depriving the taxpayers and the unemployed in this country of resources which are vital to them in order to scatter them over the length and breadth of the globe. In these circumstances, it is just as well to appreciate what the true facts are. Normally speaking, we hear hon. Members opposite express sympathy with all who suffer, in whatever part of the world they may be, but when they are invited to translate their sympathy into reality we always find some difficulty in the way.

Mr. M. JONES: Have the bondholders suffered?

Mr. HORE-BELISHA: They are to lose 30 per cent. of their incomes. The country should appreciate exactly the nature of the problem with which we are asked to deal. The Royal Commission tells us that:
As a result of three successive seasons in which the fishery yielded no return, the winter of 1932–33 found the people living in conditions of great hardship and distress. Privation was general, clothing could not be replenished, credit was restricted and hardly anywhere did the standard rise above a bare subsistence. Lack of nourishing food was undermining the health and stamina, cases of beri-beri, a disease caused by inferior diet, and of malnutrition were gradually increasing, and were to be found in numerous settlements. The general attitude of the people was one of bewilderment and hopelessness.
The Commission also tell us that no less than 70,000 persons, or 25 per cent. of the population, were in receipt of public relief, which in view of the meagre resources of the island only amounts to
7s. per month. These are the people who are appealing for assistance; and we are told by the hon. Member for Rothwell and the hon. Member for Caerphilly that assistance ought not to be forthcoming. Interruption. The hon. Member for Rothwell told us that he did not object to helping people who were ready to help themselves; the implication being that, apparently, these people are not willing to help themselves and that these evils are the results of their own wrongdoing. Let us see the extent to which these people have tried to help themselves. Reductions in the salaries of the Civil Service and Government employés have been increased from 25 per cent. to 27½ per cent., and are now on such a severe scale that it may be doubted whether they can continue much longer without causing hardship and distress. Their resources arc becoming exhausted and no margin is left for the renewal of clothing and other necessities, and it is clear that a continuance of reductions on the present scale must make for conditions which will detract from efficiency and so militate against the best interests of the country. Salaries of Ministers of the Crown have been reduced by 33 per cent., salaries of judges by 20 per cent.; pensions have been reduced from 30 to 45 per cent., and War pensions have been reduced by an average of 20 per cent. The grant for education has been cut in half, the expenditure on public charities has been reduced by 30 per cent. and so has the expenditure on marine fisheries, agriculture, mines and Customs administration. Expenditure on roads and bridges has fallen to 25 per cent. of the amount spent two years ago, while the expenditure on posts and telegraphs has been reduced by one-half.
These are the people in reference to whom the hon. Member for Rothwell says that he has no objection to helping people who help themselves. What further sacrifices are they expected to make before achieving the standard of the hon. Member 4 He also said that the Government were rushing this matter. He knows that it has a long history/. He knows the steps we have taken to advise and assist the Newfoundland Government. We sent out a Royal Commission to report upon the conditions, and their report has been for some time in the hands of hon. Members. Now he says that the matter is being rushed. Does he realise, looking
to the immediate future, that in the view of the Royal Commission:
Taking the island as a whole there is no doubt that … the next six months will be months of intense hardship and privation. The progressive effect of such conditions on a people already tried to breaking point, under-nourished, without adequate clothing and easy victims to disease, cannot but arouse the most serious apprehensions.
Perhaps in these circumstances the hon. Member will consent to hasten a little. He is reluctant, he says, to come to their assistance. Why? Because the evils of which we speak come, he says, from private enterprise; it is private enterprise which has brought Newfoundland to its present pass. It is not private enterprise; it is public enterprise:
The yearly deficits between 1920–32 were met from the proceeds of dollar loans. … It will suffice to record here that they served the object not merely of enabling the Government of the day to liquidate its annual deficit on current account, but also of providing it with funds with which to embark on costly schemes of capital expenditure. Among the projects so financed may be instanced the construction of a dry dock to replace that built in 1882, the taking over and improvement of the railway"—
A public enterprise—
the expansion of the telegraph and telephone services"—
Public enterprise—
and the provision of steamers for coastal services.
Again public enterprise—
Unfortunately none of these projects has proved directly remunerative. An ambitious scheme of highroad construction, originally designed to attract tourists to the island, but afterwards diverted from as main purpose, was similarly financed from loan funds, and proved a costly experiment, while the expenditure incurred in the construction of numerous public works and buildings throughout the country served merely to increase the mounting national debt.
I make that quotation to remove once and for all from the hon. Member's mind the idea that this failure has been caused by private enterprise. On the contrary. He may also learn that there are dangers in the system of government which he advocates. If I have established that the need is urgent and is one such as might properly be dealt with, the question arises as to whether we should best meet it by going to the roots of the difficulty. The roots of the difficulty the
Royal Commission tells us are the National Debt, which they say must be reduced. The Newfoundland people do not desire to be the first people in the British Empire to default in their obligations. There is a moral aspect of the matter, and there is also the aspect of self-interest. The hon. Member seemed to think that it does not matter if you allow a repudiation of national obligations. If lion. Members opposite would only read the report of the Royal Commission they would see the serious disasters which would ensue and which would fall with great effect on the banks and the traders of the country.
We desire to assist Newfoundland to meet her national debt interest. That debt is divided into three parts. The debt which is secured on specified assets, which we desire to release for the benefit of the island, will be liquidated in cash. With regard to the other obligations, whether trustee or non-trustee, there is an alternative, either to retain the present security or exchange it for another British Government security. Some of the securities are expressed in pounds or dollars at a specified rate of exchange, and securities will be liquidated in that form. We give a security worth up to 20s. in the pound in exchange for those loans. The hon. and gallant Member thought that it would be better to allow Newfoundland to default—

Lieut.-Colonel SPENDER-CLAY: I did not say that. I said that they should take a token payment.

Mr. HORE-BELISHA: A token payment would, of course, he default if. …

Lieut.-Colonel SPENDER-CLAY: The hon. Member has not asked these people whether they are prepared to accept conversion.

Mr. HORE-BELISHA: If you make a token payment which is not agreed to by the bondholders, that is default. The hon. Member for Bridgeton (Mr. Maxton) wishes to adopt a far more ingenious scheme, as far as I understand it, of allowing the bonds to fall on to the market and then buy them up. That would not be a very reputable proceeding. If you are coming to the assistance of a debtor country it is better to come properly at once, and openly, and say to all the creditors that we will pay them
20s. in the £—and we are offering to the creditors in these transactions the equivalent of up to 20s. in the pound. The right hon. and gallant Member for Tonbridge (Lieut.-Colonel Spender-Clay) seemed to think there was something improper in the distinction drawn between the holders of trustee securities and the holders of deferred securities. He cannot have listened to the Chancellor of the Exchequer, who explained how that position arises. There is no question of trying to obtain an advantage for trustee security holders. The matter arises in this way. There is a condition which governs the issue of trustee securities under the Colonial Stock Act, and, in view of that condition, which the Chancellor of the Exchequer read to the Committee, we cannot properly acquiesce in an arrangement by which the Newfoundland Government should deliberately depart from the terms of the original contract in regard to this trustee stock, more especially as we should ourselves, once the new form of Government has been set up, be responsible for giving effect to such a change in the terms of the contract. It is plain that we could not have adopted any position except that which we have, and I am sure the words of my right hon. Friend the Chancellor of the Exchequer will make it completely plain to the right hon. and gallant Member when he re-reads them.
The Chancellor of the Exchequer dealt with the financial aspects of this matter in great detail, and I need not go over them again. He told the Committee candidly exactly what obligations this country was assuming until 1936, and what the saving would be on the new conversion loan we are about to issue. There remains the deficit which we shall have to meet year after year. It can only be met by an improvement in the conditions in the island, and the observations and suggestions made by the right hon. Member for Sparkbrook (Mr. Amery), the Noble Lord the right hon. Member for Horsham and the hon. Member for Orkney and Shetland (Sir R. Hamilton) will receive every sympathy by a Government which intends to improve to the best of its ability the resources of Newfoundland, which are undoubtedly great. It is partly for that reason that one of the paragraphs in the Financial Resolution brings Newfound-
land within the scope of the Colonial Development Act. In that connection I must point out to the hon. Member for Caerphilly, who complained of the Colonial Development Act, that it was introduced by his Government and that the Second Reading of the Bill was actually moved by the hon. Member who now sits alongside him. We agree that the deficit can only be corrected by an improvement in the resources of the island. The hon. Member for Caerphilly said that if we do improve the resources of the island we are depriving Newfoundland of its political liberty, and that that is a tremendous setback to a State. The islanders are wise enough to have their own views upon that matter, and the Royal Commission expresses them:
The people of Newfoundland are fully content that the island should be known as Britain's oldest colony,' and constitutional niceties, which in any case are held to be of small importance compared with the necessity of rescuing the country from its present dangers, make no appeal to them.
Distasteful though it may be, they are prepared to petition the King for a revision of the terms of government. Constitutional niceties do not concern them as much as they concern hon. Gentlemen opposite.
For forms of government let fools contest,
Whate'er is best administer'd is best.

Mr. MAXTON: In presenting this matter to the House the Financial Secretary puts 1936 as the limit of our financial responsibility. I did not understand that from the speech of the Chancellor of the Exchequer. Is the position not in fact that we are assuming complete responsibility for the service of this loan for all time?

Mr. HORE-BELISHA: I think the hon. Member has misunderstood me. We are talking of two different matters. The British Government guarantee the new loan which is to be issued. It is, of course, a guarantee until the loan matures. But we are making certain grants of money which are upon a voluntary basis and are not to be added to the debt. Those sums at any rate will be voluntary until the year 1936.

Mr. MAXTON: The only good thing, the only difference which arises in 1936, is that the continuation will then be considered. The year 1936 therefore means nothing.

Mr. CHAMBERLAIN: 1936 is the date up to which we have already proposed that the sums we vote to meet deficiencies in Newfoundland's Budgets shall be considered as free gifts. Our responsibility does not end in 1936. What remains after that is a determination of the ques-

tion whether any future advances which may be necessary shall be gifts or loans.

Question put.

The House divided: Ayes 227; Noes, 38.

Division No. 12.]
AYES.
[7.48 p.m.


Acland, Rt. Hon. Sir Francis Dyke
Fielden, Edward Brocklehurst
Milne, Charles


Acland-Troyte, Lieut.-Colonel
Fleming, Edward Lascelles
Molson, A. Hugh Elsdale


Adams, Samuel Vyvyan T. (Leeds, W.)
Foot, Dingle (Dundee)
Moore, Lt.-Col. Thomas C. R. (Ayr)


Agnew, Lieut.-Com. P. G.
Foot, Isaac (Cornwall, Bodmin)
Morris, Owen Temple (Cardiff, E.)


Albery, Irving James
Fraser, Captain Ian
Morris-Jones, Dr. J. H. (Denbigh)


Allen, Lt.-Col. Sir William (Armagh)
Fuller, Captain A. G.
Morrison, William Shepherd


Amery, Rt. Hon. Leopold C. M. S.
Galbraith, James Francis Wallace
Moss, Captain H. J.


Anstruther-Gray, W. J.
Gillett, Sir George Masterman
Muirhead, Lieut.-Colonel A. J.


Applin, Lieut.-Col. Reginald V. K.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Munro, Patrick


Aske, Sir Robert William
Glossop, C. W. H.
Nall, Sir Joseph


Baillie, Sir Adrian W. M.
Goff, Sir Park
Nall-Cain, Hon. Ronald


Baldwin, Rt. Hon. Stanley
Goldie, Noel B.
Nicholson. Rt. Hn. W. G. (Petersf'ld)


Balniel, Lord
Goodman, Colonel Albert W
Nunn, William


Barclay-Harvey, C. M.
Graham, Sir F. Fergus (C'mb'rl'd, N.)
O'Donovan, Dr. William James


Beauchamp, Sir Brograve Campbell
Grattan-Doyle, Sir Nicholas
Palmer, Francis Noel


Beaumont, Hon. R.E.B. (Portsm'th,C.)
Graves, Marjorie
Pearson, William G,


Benn, Sir Arthur Shirley
Greaves-Lord, Sir Walter
Peat, Charles U.


Bernays, Robert
Grenfell, E. C. (City of London)
Penny, Sir George


Birchall, Major Sir John Dearman
Gretton, Colonel Rt. Hon. John
Percy, Lord Eustace


Blindell, James
Grimston, R. V.
Perkins, Walter R. D.


Borodale, Viscount
Gritten, W. G. Howard
Petherick, M.


Boulton, W. W.
Guest, Capt. Rt. Hon. F. E.
Pike, Cecil F.


Bowater, Col. Sir T. Vansittart
Guinness, Thomas L. E. B.
Procter, Major Henry Adam


Bower, Lieut.-Com. Robert Tatton
Guy, J. C. Morrison
Pybus, Percy John


Bowyer, Capt. Sir George E. W.
Hamilton, Sir R. W.(Orkney & Zetl'nd)
Raikes, Henry V. A. M.


Braithwaite, J. G. (Hillsborough)
Hannon, Patrick Joseph Henry
Ramsay, Capt. A. H. M. (Midlothian)


Briscoe, Capt. Richard George
Hartland, George A.
Ramsay, T. B. W. (Western Isles)


Broadbent, Colonel John
Harvey, George (Lambeth, Kenningt'n)
Rankin, Robert


Brocklebank, C. E. R.
Headlam, Lieut.-Col. Cuthbert M.
Rea, Walter Russell


Brown, Col. D. C. (N'th'l'd., Hexham)
Heligers, Captain F. F. A.
Reed, Arthur C. (Exeter)


Brown, Ernest (Leith)
Holdsworth, Herbert
Reid, William Allan (Derby)


Brown, Brig.-Gen.H.C.(Berks.,Newb'y)
Hore-Belisha, Leslie
Remer, John R.


Browne, Captain A. C.
Hornby, Frank
Rentoul, Sir Gervais S.


Buchan, John
Horobin, Ian M.
Rhys, Hon. Charles Arthur U.


Buchan-Hepburn, P. G. T.
Hudson, Robert Spear (Southport)
Rickards, George William


Burgin, Dr. Edward Leslie
Hume, Sir George Hopwood
Rosbotham, Sir Thomas


Burnett, John George
Hunter, Dr. Joseph (Dumfries)
Ross Taylor, Walter (Woodbridge)


Campbell, Sir Edward Taswell (Brmly)
Hurd, Sir Percy
Ruggles-Brise, Colonel E. A.


Caporn, Arthur Cecil
Janner, Barnett
Russell, Albert (Kirkcaldy)


Cayzer, Sir Charles (Chester, City)
Jennings, Roland
Russell, Alexander West (Tynemouth)


Chamberlain, Rt. Hon. N. (Edgbaston)
Jesson, Major Thomas E.
Russell, Hamer Field (Sheffield, B'tside)


Chapman, Sir Samuel (Edinburgh, S.)
Joel, Dudley J. Barnato
Russell, R. J. (Eddisbury)


Clayton, Sir Christopher
Johnston, J. W. (Clackmannan)
Salmon, Sir Isidore


Cobb, Sir Cyril
Johnstone, Harcourt (S. Shields)
Sandeman, Sir A. N. Stewart


Cochrane, Commander Hon. A. D.
Ker, J. Campbell
Sanderson, Sir Frank Barnard


Colfox, Major William Philip
Knox, Sir Alfred
Scone, Lord


Conant, R. J. E.
Law, Sir Alfred
Shakespeare, Geoffrey H.


Cook, Thomas A.
Leckie, J. A.
Shaw, Helen B. (Lanark, Bothwell)


Cooke, Douglas
Leech, Dr. J. W.
Shaw, Captain William T. (Forfar)


Copeland, Ida
Leighton, Major B. E. P.
Shepperson, Sir Ernest W.


Courtauld, Major John Sewell
Levy, Thomas
Shute, Colonel J. J.


Craddock, Sir Reginald Henry
Lewis, Oswald
Sinclair, Maj. Rt. Hn. Sir A. (C'thness)


Craven-Ellis, William
Llewellin, Major John J.
Skelton, Archibald Noel


Crooke, J. Smedley
Llewellyn-Jones, Frederick
Somervell, Sir Donald


Crookshank, Col. C. de Windt (Bootle)
Lovat-Fraser, James Alexander
Somerville, Annesley A. (Windsor)


Croom-Johnson, R. P.
MacAndrew, Lieut.-Col. C. G.(Partick)
Soper, Richard


Cruddas, Lieut.-Colonel Bernard
MacDonald, Malcolm (Bassetlaw)
Sotheron-Estcourt, Captain T. E.


Curry, A. C.
MacDonald, Capt. P. D. (I. of W.)
Southby, Commander Archibald R. J


Davies, Edward C. (Montgomery)
McKie, John Hamilton
Spears, Brigadier-General Edward L.


Denman, Hon. R. D.
McLean, Major Sir Alan
Stanley, Lord (Lancaster, Fylde)


Despencer-Robertson, Major J. A. F.
McLean, Dr. W. H. (Tradeston)
Stourton, Hon. John J.


Dickie, John P.
Macmillan, Maurice Harold
Strauss, Edward A.


Dugdale, Captain Thomas Lionel
Magnay, Thomas
Sueter, Rear-Admiral Murray F.


Duggan, Hubert John
Mallalieu, Edward Lancelot
Sugden, Sir Wilfrid Hart


Eden, Robert Anthony
Mander, Geoffrey le M.
Summersby, Charles H.


Edmondson, Major A. J.
Manningham-Buller, Lt.-Col. Sir M
Tate, Mavis Constance


Elmley, Viscount
Margesson, Capt. Rt. Hon. H. D. R.
Thomas, Rt. Hon. J. H. (Derby)


Emrys-Evans, P. V.
Marsden, Commander Arthur
Thomas, James P. L. (Hereford)


Erskine, Lord (Weston-super-Mare)
Martin, Thomas B.
Thomson, Sir Frederick Charles


Erskine-Bolst, Capt. C. C. (Blackpool)
Mason, David M. (Edinburgh, E.)
Thorp, Linton Theodore


Evans, Capt. Arthur (Cardiff, S.)
Mayhew, Lieut.-Colonel John
Todd, Capt. A. J. K. (B'wick-on-T.)


Evans, David Owen (Cardigan)
Mills, Major J. D. (New Forest)
Train, John


Tree, Ronald
Whyte, Jardine Bell
Wood, Sir Murdoch McKenzie (Banff)


Wallace, John (Dunfermline)
Williams, Charles (Devon, Torquay)



Wedderburn, Henry James Scrymgeour
Wilson, G. H. A. (Cambridge U.)
TELLERS FOR THE AYES.—


Wells, Sydney Richard
Winterton, Rt. Hon. Earl
Captain Austin Hudson and Mr. Womersley.


Whiteside, Borras Noel H.
Withers, Sir John James.



NOES.


Adams, D. M. (Poplar, South)
Grundy, Thomas W.
Parkinson, John Allen


Attlee, Clement Richard
Hall, George H. (Merthyr Tydvil)
Price, Gabriel


Batey, Joseph
Jones, J. J. (West Ham, Silvertown)
Salter, Dr. Alfred


Brown, C. W. E. (Notts., Mansfield)
Jones, Morgan (Caerphilly)
Smith, Tom (Normanton)


Cape, Thomas
Lansbury, Rt. Hon. George
Spender-Clay, Rt. Hon. Herbert H.


Cocks, Frederick Seymour
Logan, David Gilbert
Tinker, John Joseph


Cripps, Sir Stafford
Lunn, William
Williams, Edward John (Ogmore)


Dagger, George
Macdonald, Gordon (Ince)
Williams, Dr. John H. (Llanelly)


Davies, David L. (Pontypridd)
McEntee, Valentine L.
Williams, Thomas (York., Don Valley)


Davies, Rhys John (Westhoughton)
McGovern, John
Wilmot, John


Dobbie, William
Mainwaring, William Henry



Edwards, Charles
Maxton, James
TELLERS FOR THE NOES.—


Graham, D. M. (Lanark, Hamilton)
Milner, Major James
Mr. John and Mr. Groves.


Grenfell, David Rees (Glamorgan)
Owen, Major Goronwy

Resolution to be reported To-morrow.

Orders of the Day — AGRICULTURAL MARKETING BILL.

Order for Second Reading read.

7.57 p.m.

The MINISTER of AGRICULTURE (Mr. Elliot): I beg to move, "That the Bill be now read a Second time."
This Bill is in furtherance of the pigs and bacon schemes which were passed by this House on 28th June and brought into operation on 5th July. The schemes were, under the terms of the Act of 1931, submitted to the whole of the pig and bacon producers. They aroused much interest, and a very large number of pig producers—well over 100,000—registered. Of those registering 99 per cent. voted for the scheme. Of bacon producers practically every firm of importance registered, and on the whole a majority of about 70 per cent. in number, and a much larger proportion in output, signified their assent. As the House may remember, the schemes provided for the sale by contract of the pigs necessary to British bacon production. The sales are by contract from the farmers to the curers. The curer was to get a known supply and the farmer was to get a known price.
The schemes came into operation on 10th September. They were operated in the first instance on the basis of an understanding between the Pig Producers' Board and the Bacon Producers' Board, two organised bodies which had resulted from the two polls of which I
have just spoken. It was on the basis of an understanding between those two boards that the initial stages of the scheme were worked. The understanding was that pigs bought by curers from producers should fetch a price of 12s. per score. That price, of course, had had to be negotiated some time before, and actually it had been negotiated as early as May, that is to say some four months before the price was to come into operation. The actual task of the two boards, however, could not be defined until the actual contracts were ascertained, and clearly the number of actual contracts could not be finally ascertained until just before they began to run because it was open to anyone to make a contract up to a date just prior to the date on which the contracts were to begin to operate.
The date chosen for the beginning of the actual contracts between producer and curer was 1st November. Immediately the scheme had been accepted by the polls of course, the collection of contracts began but they were not finally collected, the contracts were not completed, the subscription lists so to speak were not closed until lath October. It then appeared that a very large number of producers had been found who were willing so to contract. The curers realised that, instead of a £3,000,000 proposal which they had been considering before, they had on their hands a £5,000,000 proposal. I am giving the figures in pounds sterling instead of in cwts. of bacon so that the House may see how large are the figures both financially and in food values with which we are dealing, and in order that it may get into scale the proposals for the advance which this Bill and this Financial Resolution enshrine.
The curers, then, found that they had to handle this very large £5,000,000 proposal within the next few months. That of course included Northern Ireland because the whole United Kingdom had to be treated as one for this purpose. The contracts which had been collected were provisional only, and I want to bring this point particularly to the attention of those hon. and right hon. Gentlemen who have said, "Why should anybody help the curers out of the hole and particularly why should the producers have to help them in this matter? "The primary producers, they say, always have to pay. Why should the primary producers always have to come along and help? Because the contracts were not finally signed, sealed and delivered, and, faced with this very large quantity of bacon and this very large proposal, it was legally open to the curers to say, "We cannot go on under these conditions. "Clearly, that would have been most injurious to the primary producers, and therefore, quite apart from the general interest of the primary producer not to bankrupt the processor—because the processor is the funnel by which the primary product eventually reaches the public—he had here an immediate and particular interest. It was to his interest to see that these contracts were accepted, signed, sealed and delivered and that pigs began to pass between farm and factory on the contract system at the earliest possible moment.
The Bacon Board thereupon got into consultation with the Pigs Board and the two boards then consulted the Government. Here we see in operation what I think is a novel and very interesting and valuable process. For the first time producers in agriculture found their own collective credit at their disposal and were able to use it, organised as they were. They had security to offer and that security they determined to make use of, I think very soundly and with very valuable results. The organised primary producers found that they themselves could discuss the matter with the organised processors, and that the two together could bring forward a proposition which was worthy of consideration not only by the Department but by the Agricultural Marketing Facilities Committee set up under the Act of 1931, and subsequently by the Treasury.
The proposal which we are making derives from the fact that under the Act of 1931 it was foreseen that the flotation of these schemes would require initial expenses. Two sections of that Act deal with the matter. Section 13 deals with short-term loans, and contains provisions as to committees, in connection with the administration of these short-term loans. Here then were two boards anxious to carry through this large piece of collective agricultural organisation and here was the machinery which Parliament as long ago as 1931 had erected for dealing with precisely such an emergency. It is true that the precise circumstances in which such difficulties would arise had not, as one might easily imagine, been foreseen in every detail. Hence the necessity for this amending legislation which I have to lay before the House. Let me say that, quite different from the Financial Resolution which we have just been discussing, this proposal meets, as far as I can make out, in every detail the demands made by the Mover of the rejection of the previous Resolution, an hour or two ago standing at that Box. It deals with helping those who are willing to help themselves. It deals with a loan which is made on good security, and is recoverable and it deals with the advantage and security of our own people who have here embarked upon a very big piece of work in which all this House wished them well only a few months ago.
The actual Bill 'is explained fairly clearly in the Memorandum and also in the Clauses themselves. It may be found convenient if I only make a short statement on it now. At a later stage in the Debate if the House so desires, I may by leave of the House intervene again, and the Under-Secretary of State for Scotland or I will deal with any objections which are raised to the Bill. There are many very interesting features in these proposals and it would be of interest to those concerned with agricultural organisation to examine them very closely. The question of the adjustment of a contract price, with which agricultural organisations have struggled repeatedly and which finds its chief example M the contract price in the case of sugar-beet is here again tackled and I think not unsuccessfully. The principle of a levy which is an integral part of the Milk Marketing scheme is here again intro-
duced, and I think with good reason. But I do not wish my natural Scottish interest in general principles to lead me away from what I know English Members so much desire me to deal with, namely, the practical question of how this meets the needs of the case.
The Bill, in Clause 1, empowers a board to pay compensation to their producers in respect of any loss which the board may be satisfied the producers have sustained by the operation of a marketing scheme whether administered by that board or not. That Clause will enable the Bacon Board to compensate individual bacon curers for any loss which they may have sustained by reason of the contracts recently entered into by them with the producers of pigs. To enable this to be clone the bacon scheme will have to be amended. Clause 2 enables a scheme to provide for empowering a board to lend or grant money to another board. That is to enable the primary producers' board to ensure that the processors, in whose fortunes they are as vitally interested as in their own, shall not be destroyed by reason of any miscalculation in the initial stages of the scheme.
Clause 3, in Sub-section (1) merely makes provision for a board accepting such grant. Subsection (2) enables a scheme to provide for empowering a board in any case where a loan or grant is proposed to be made to them, to agree with the lender or granter that the board may apply the money taken by them in accordance with such conditions as may be specified in the agreement. That subsection will enable the Bacon Board to agree with the Pigs Board who are guaranteeing the loan proposed to be made to them, that they will apply the money with the consent of and on the advice of a committee consisting of three persons representing the Pigs Board, three persons representing the Bacon Board, the three persons nominated by the Minister. Thus there will be on the committee three from the primary producers who are making the loan, three from the processors who are accepting the loan, and three independent persons who shall be nominated to see fair play—not an unnecessary precaution when people are buying and selling pigs or any other form of agricultural produce.
I need only say that we have provisionally appointed such a Committee.
The Chairman is Sir Wyndham Portal, who was a member of the Pigs Commission, and the other two members are Mr. H. G. Howitt, of Messrs. Peat, Marwick, Mitchell & Co., chartered accountants, and Mr. W. H. Coates, who is well known as a director and economist of Imperial Chemical Industries. Both Mr. Howitt and Mr. Coates are members of the Agricultural Marketing Facilities Committee, which investigated the soundness or otherwise of the financial proposition which was being made. Therefore these are three very knowledgeable persons and I am sure the House will be glad to know that they were accepted readily by both boards as being not merely umpires and arbitrators but persons whose advice and assistance the two boards would be very glad to have.
The effect of Clause 4 will enable the Minister, by Order, to enable the Pigs Board, if they so desire, to guarantee the proposed loan to the Bacon Board and by means of that Order to enable the Bacon Board to pay compensation to their registered producers and to require that the Bacon Board shall apply the loan on the advice of the committee which I have just sketched out, Sir Wyndham Portal's Committee. Clause 5 clarifies the provision of the Act of 1931 and lays down that any expenses incurred within the period of one year from the date at which any marketing scheme comes into force shall be deemed to be "expenses incurred in connection with the initial working of the scheme." These words in the Act of 1931 can now, I think, with advantage be clarified, and this to some extent limits the liability of the Treasury under the statute.
Clause 6 contains provisions empowering the board to buy from the board administering any corresponding scheme any product the marketing of which is regulated by that scheme; these provisions are designed to remedy defects in the 1931 Act which, as it stands, would prevent the English board buying from a Northern Irish or Scottish board or acting as agent for such a board. Clearly it is greatly to the advantage of the pig industry as a whole that the large English board should, if both boards so desire, act as agent for another board or another group, say, in Northern Ireland handling a corresponding scheme. This is desired by both pig boards and both
countries, and I am sure will be acceptable to the House. That Order can only be made at the request of the board and not on the initiative of the Minister himself.
These are the provisions of the Bill. If the House should desire it, I should be very glad to elucidate any point which I may have failed to make clear or to deal with any aspect of the situation which the House might desire me to do later. I think the initial stages of the scheme have shown, first of all, that there is an unlooked for readiness in the British agriculturist to organise and to come forward under these contract provisions; secondly, that the scheme is working, not to promote inefficiency but to promote efficiency. The bacon curers report a total change of spirit among the primary producers in regard to the faults which they point out to these producers, that they all say, "We are anxious to learn; show us what we are doing wrong, and we will do our utmost to put these faults right." There has, for instance, been a very satisfactory increase in the demand for pedigree boars. The British producer is doing his utmost to grade up his pig as rapidly as possible to the pig that is necessary for the successful production of bacon in this country. It has been reported even that in their anxiety to follow out the development of their pigs, there was for the time being a shortage of pig weighing-machines, showing that there is an outlet for the manufacturers of this country even in their own country as well as elsewhere.
As for the alteration of processes among the curers a real effort is being made by the bacon industry to develop the tank curing process, which was one of the great strengths of Danish as against British bacon production. It is known that some factories have already made provision to deal with over 13,000 pigs per week by this process and that other schemes of development are in hand. I should say that the small pig producer is becoming very interested in this scheme. Small pig keepers who previously kept a pig or two for their own use are beginning to consider an extra pig or two for sale. The scheme makes special provisions in the form of group contracts for the small man, and in Wales, for instance—I am sure some of my hon. Friends opposite will he interested in this—where the small pro-
ducer predominates, two-thirds of the bacon pigs for the current period were sold on group contracts, that is to say, from small men.
One last point as to the interests of the consumer. It may be said that the consumer has been unduly penalised by the restriction of bacon imports into this country and the price of bacon. I have already dealt, cursorily it may be, with the question of bacon prices, and I do not think it can be said that they are more out of reach of the small man, the man of the small purse or the housewife of the small purse, than they were two or three years ago, when hon. and right hon. Members opposite were sitting on this side and were supported by a great number of Members who have now moved a little nearer to them, though still showing spiritual dissension. But: I would ask the attention of the House to this fact that the cuts in imported bacon and the large increase in pig production in this country have the effect of creating an additional supply of cheap food in the form of byproducts such as livers, kidneys and so on, and fresh meat, which is itself a valuable food. For every bacon pig killed there are some 40 lbs. of fresh edible byproducts, which, in the case of imported bacon pigs, we do not get. The increase in the home output of bacon in Great Britain means an additional 300,000 to 400,000 cwts. of cheap fresh meat coming from our bacon factories every year. I do not wish to exaggerate that point, but it should not be lost sight of, since one of the dangers, I think, of our modern dietary in this country is an over great reliance upon tinned and preserved foods of every kind.
These are the main features of the proposals that I wish to lay before the House to-night. They present novel features, but I do not think they arc more novel than the situation demands. The House sanctioned large new departures in British agricultural organisation. The agriculturists and the processors went in whole-heartedly for their schemes, and the very success of the schemes produced difficulties. These difficulties I think had to be solved, or else we had to abandon the whole of the policy, for which I am sure I should have been roundly, and rightly, blamed by the House and by the country. We have adopted certain proposals to deal with those difficulties, which I think are defensible on their.
merits; they are financially sound, they have been examined by committees which were set up not in view of this emergency but long before, and I think they have every prospect of working so as to give the schemes their initial chance, without which the whole thing would come absolutely to an end.

8.25 p.m.

Mr. T. WILLIAMS: I beg to move to leave out the word "now," and, at the end of the Question to add instead thereof the words "upon this day six months."
Before making reference to the right hon. Gentleman's statement or to the Bill, I should like to make a brief reference to our late colleague Sir George Edwards, of whose death we all regretted to learn to-day. Those who knew the late Sir George will agree when I describe him as a great, noble and courageous personality, and one who devoted the whole of his life to improving the lot of the agricultural worker. We have lamented his departure, but we shall long revere the memory of a man of whom it can he said that he did his duty to the bottom dog.
This Bill is one more instrument of the Government's plan for making agriculture pay. The right hon. Gentleman has told the House a good deal about the pig and bacon marketing schemes, but, so far as I could understand, the real intention and purpose of this Bill was scarcely referred to. The right hon. Gentleman went from Clause 1 to Clause 6 in a very summary fashion and gave a brief outline of what he believes the Bill is likely to accomplish. I shall have some observations to make which will perhaps not be consistent with those of the right hon. Gentleman. We have had a good deal of regulation, control, compensation, loans and credits since the present Government have been in office. A good deal has been said about dictatorships, but I should imagine that my hon. and learned Friend the Member for East Bristol (Sir S. Cripps) blushes with shame at his modesty when he looks at some of the Measures introduced by the right hon. Gentleman. Whatever happens to agriculture as the result of the present Government, and particularly of the present Minister of Agriculture-and this is one more instrument-it seems to me that the right hon. Gentleman will succeed in
one thing, that is, in making this nation safe for landowners.
This Bill is described as an Agricultural Marketing Bill. I have looked at it very carefully, and have tried to visualise all its possibilities and to appreciate the desires and aspirations of the right hon. Gentleman, but I am driven to the inevitable conclusion after careful analysis that, instead of it being described as an Agricultural Marketing Bill, it ought to be described as the Landowners (Rent Guarantee) Bill. If any hon. Member should disagree with that, perhaps another description would not be out of place, and it might very well be described as the Farmers (Guarantee against Loss) Bill. The poor old consumer, as usual, remains as defenceless as hitherto.
The right hon. Gentleman has certainly given some explanation of the intentions of the Measure, and we readily concede to him that when the Act of 1931 was passed it was realised that, once these marketing schemes got under way, certain difficulties would present themselves and that they would have to be dealt with as and when they occurred. We never contemplated, however, that a National Government, or indeed any Government, would produce a Bill which for the first time in the history of Parliament seems to guarantee a considerable number of producers in this country against any kind of loss. It is perhaps not to my credit, but I have often looked round for a real certainty, one of those things on which one could bet without any shadow of doubt and no loss at all. Here is a Bill which will mean to the farmer that, whatever horse he backs, he is bound to back a winner. He is guaranteed against losses of any kind in Clause 1. Under Sec-7 (1, c) of the original Act of 1931, arrangements were made for limited compensation to ensure equity between producer and producer and to ensure equity between profit and loss for all registered producers. Under Section 16 (1) of the Agricultural Marketing Act, 1933, there was a slight extension so that compensation was payable in accordance with a given scheme to such class of cases and as was specified in the scheme; that is to say, any registered producer operating within any scheme could secure compensation if he could prove that his loss was associated with the
operation of that scheme. A number of hon. Members attempted to secure an extension there during the Committee stage of the 1933 Act. They failed, but this Measure in Clause 1 extends the power to provide compensation not only for the purposes of providing equity for all registered producers, but in respect of any loss.
occasioned to such producers by the operation of any scheme, whether administered by that board or not.
Obviously, the right hon. Gentleman is bound to appreciate that serious repercussions may occur. No longer is compensation confined to securing equity or to producers operating within one scheme. Actually Clause 1 provides for the meeting of losses accruing to farmers working under any scheme, whether they happen to be a member of that scheme or not. May I ask the right hon. Gentleman whether he appreciates that if a producer or a number of registered producers operating under one scheme find themselves guaranteed against any losses, whatever their policy may be, such guarantee is calculated to encourage further wild policies on the part of those in charge of the board. Certainly that contingency is a possibility, and it seems to me to be an extraordinary proposal that, while there is no guarantee for the consumer or indeed for any section of the community apart from the registered producers, they are all the time guaranteed that if their scheme becomes bankrupt they can be compensated out of some other scheme.
I want to ask the right hon. Gentleman whether an action may lie by one board against another board whose policy occasions losses to registered producers. What safeguard or guarantee is there for a board operating successfully on the basis of policies that have been well thought out? They are likely to have to provide for losses which accrue as the result perhaps of some faulty policy operated by a board in charge of some other commodity.

Mr. ELLIOT: I am sure that my hon. Friend does not wish to be under any misapprehension. That cannot happen unless the other board desires to compensate the first board. There is nothing to compel board A to find money
for board B, and nothing in the Bill compels board A to find the money. This is merely an enabling Bill to enable board A to make a grant to board B, and for board B to administer that money in accordance with the scheme which obviously board A would draw up.

Mr. WILLIAMS: I agree with the right hon. Gentleman up to a point, but the wording in the Bill distinctly empowers the board
to pay compensation to registered producers in respect of ally loss which, in the opinion of the board, has been occasioned to such producers by the operation of any scheme, whether administered by that board or not.
It seems to me to be without any restriction whatever so long as the board are satisfied that the losses were occasioned by the operation of the scheme.

Mr. ELLIOT: I do not wish to interrupt my hon. Friend repeatedly, but it merely empowers the board to pay and makes no provision as to where the board is to get its money. [Interruption.] The hon. Member may be more fortunate in getting money than I am. My difficulty is not what 1 am to do with the money, but how I can get it, and there is nothing to enable the board to get it unless it has made out a good case for persuading another board to find it.

Mr. WILLIAMS: That is the very essence of my objection to this proposal. I am not concerned about a. board misjudging their policy and losses being thereby occasioned and their having power to secure a loan with which to meet those losses, what. I am concerned about is that, with al these guarantees, it is the poor old consumer who in the end is going to pay the price. The right hon. Gentleman has frequently said that he will never rest happy until imports are restricted or available supplies bear such a near relation to demand as to give economic prices. Therefore, apart from the power to secure loans with which to meet these losses, these boards will always have the power to increase prices. They can meet their losses directly by increasing prices, if they do not wish to obtain a loan, and I do not think the right hon. Gentleman has got over that point. There is a guarantee for any loss occasioned by the operation of any scheme, whether the loser is a registered producer under that scheme or not.
It is true that the boards have power to secure loans, but they have a bigger power, that of charging a price, whether for milk or any other commodity, which will meet not only current requirements but any losses that may occur. So long as the right hon. Gentleman restricts imports and restricts supplies so that demand exceeds supply, and these boards can obtain their price, our complaint will be justified.
What is likely to happen assuming that the Potato Board increase prices to pig producers, who use potatoes for feeding pigs? The pig producers will accuse the Potato Board of having occasioned them losses in pig production, and will be able to come on the Potato Board for such losses. The Milk Board may be charged by the bacon producers with having increased the cost of feeding stuffs for pigs by raising the price of skimmed milk; and other people will perhaps be able to prove that, as a result of the operation of the milk scheme, it is more costly for them to produce cheese and butter; and they have a guarantee under Clause 1 that they will be able to secure compensation for any losses that may accrue.

Mr. ELLIOT: I promise not to interrupt again, but I really think the hon. Member is over-stating the case. They have the power to approach the other board, but the other board has a perfect right to pay no attention to their protest.

Mr. WILLIAMS: No doubt the right hon. Gentleman believes that the statement he has just made meets the case, but I am not at all sure that his view is consistent with the words in the Bill. To me the words seem perfectly clear—that registered producers are guaranteed compensation for any loss occasioned to them by the operation of any scheme. Perhaps the right hon. Gentleman will examine my submission and later give us the benefit of the opinion of his experts, for I am half inclined to think the matter has not been considered closely in the light of possible reactions and repercussions. We can see the possibility of difficulties cropping up. I particularly want a reply to the question as to whether any action will lie by one board against another board whose policy occasions losses, because unless that is so where does the consumer actually come in?
Clause 2 seems to be designed exclusively to deal with subsidies, so that the stronger boards can help the weaker board. It may be conceivable that this is a method of camouflaging large loans required by some of the weaker boards. Clause 3, which the right hon. Gentleman skipped over very quickly, is presumably designed, among other things, to enable a board, either by grants received from individuals or by loans, to carry on research. Sub-section (3, b) of this Clause seems to give the right hon. Gentleman or the board power to dispose of the rights of the registered producer, who in ordinary circumstances has the right of appeal if he is aggrieved by any decision taken by the board. After the statement that power is given to receive grants or loans, paragraph (b) says:
where such an agreement contains conditions requiring the Board to act on the advice of any specified persons, the provisions of the scheme entitling a registered producer who is aggrieved by any act or omission of the Board to refer the matter to arbitration shall not apply in relation to anything done, or omitted to he done, by the Board in pursuance of the agreement.
It seems to me that the person from whom the loan or grant is received can dictate the conditions under which the money shall be expended, and the rights of the registered producer are taken away from him. In that way one can transform some moneyed person into a dictator. All the 100,000 registered producers are cast aside, as it were, by the simple process of creating a dictatorship.

Viscount WOLMER: I thought you said they had been guaranteed against all loss.

Mr. WILLIAMS: The Noble Lord will surely discriminate between Clause 3 and Clause 1, which deal with two totally different things. If a dictator such as the right hon. Gentleman is in possession, and the bacon curers happen to find themselves losing money, the two things are fairly consistent, but there is no consistency between Clause 3 and Clause 1. If the Pig Board take a loan from the Milk Board and the Secretary of the Milk Board determines how the money shall be spent, the Pig Board must ignore their registered producers and spend money as the secretary of the Milk Board dictates. I suggest that is dictatorship, and takes away the right of a registered producer to go to arbitration if he should be an aggrieved person.
As to Clause 4, I have no complaint against it, but even under this Clause, according to lines 14 to 16, the right hon. Gentleman has power, where he himself is granting a loan, to appoint a nominee, which is establishing himself as a form of potential dictator. Difficulties are almost inevitable with all these schemes, either small or large. We have to beware of the dictatorship of the right hon. Gentleman, if we want to carry with us every registered producer, whether of bacon, milk, potatoes or any other agricultural commodity, and we think that the right hon. Gentleman should be very careful about destroying the power of the individual producer. He may destroy would-be co-operators, who have come into the scheme after a lot of pressure from the right hon. Gentleman.
Clause 5 is rather difficult to understand. The right hon. Gentleman told us a good deal about the origin of the pig and bacon schemes. He told us about the original possibility of a £3,000,000 proposition, which has now developed into a £5,000,000 scheme, and, because of the size of the scheme, he went on and tried to show, without showing—at least I did not notice it—that this Bill appeared to be necessary. In dealing with Clause 5 very summarily, he briefly explained that it limits Section 13 of the original Act, whereas, in point of fact, Clause 5 extends the Act by at least one year. The original Act did not cater for meeting preliminary expenses by loans from the Government, interest free, but was limited to the extent of meeting initial expenses in preparing the scheme and taking the poll, and preliminary things of that sort. Clause 5 of the Bill, according to the right hon. Gentleman, enables all the boards that are now operating to record losses, incurred in the first 12 months of the operation of every scheme, as initial expenses, presumably in preparing this scheme. The right hon. Gentleman proceeded to tell the House that owing to the bacon scheme developing much more rapidly than was expected by bacon curers, bacon producers or the Ministry of Agriculture, certain credits and huge loans were necessary. I shall want to know from him in a moment exactly what has been happening during the past month or two.
Clause 5 is extremely difficult to understand, and I am sure that none but a legal mind could grasp the intention of the words. The Clause states:
Any expenses incurred by virtue of this Act"—
and proceeds to interpret what it means. Twelve months after the operation of the scheme those expenses may be met, the maximum sum being £650,000. What expenses can be incurred in the operation of this Bill after it becomes an Act 4 It seems that what the right hon. Gentleman has in mind is that the pig producers entered into contracts with the bacon curers at contract prices for a. certain number of pigs for a certain time. The pig producers were wise in their day and generation; they withheld pigs from the market, in a period when restrictions imposed upon imports from abroad produced a comparative scarcity. The prices of bacon therefore increased, and the pig producers entered into contracts with the curers who were wanting pigs very urgently because their factories were losing money. The factory owners contracted to pay 12s. per score for 620,000 pigs, only to find, as a result of the price of bacon, that they were unable to sell, pay the pig producers the prices that were contracted for and leave themselves what the "Times "newspaper described as "replacement value. "They commenced to lose money, and they had to approach the right lion. Gentleman.
The right hon. Gentleman has not told us anything about it, but this Bill is largely due to a set of circumstances which have never yet been explained in this House. The right hon. Gentleman wants the power to enable bacon curers to tide over a temporary period. We do not disagree with the right hon. Gentleman for helping them so to do, but he ought to tell the House and the country about it. We ought to know more about it than we know at I he present time. We ought to know from exactly what fund, if any, the bacon curers are drawing today, apart from the prices received from the sale of cured pigs. They are certainly losing money very fast, and they have already intimated that the next contract prices will be lower than the last contract prices. The present loans are very small to the Pig and Bacon Marketing Boards, but does the right hon. Gentleman contemplate that under
this Bill any large sum will be loaned to them? If so, will he tell us, as Section 13 (2) of the original Act of 1931 insists upon repayment within two years, what levy per pig will be required to meet the loan losses during the four months contract period? Bacon producers are already faced with a lower price during the next contract period, and they will have to bear a levy for each pig received by bacon curers, to wipe out the loss during the first four-monthly period. The House is entitled to know what calculations have been made in the Department, and what the levies upon registered producers are likely to amount to. Only when the registered producer knows the truth about the present situation, and a good way ahead, will he be able to plan accurately, and the bacon curer to plan accurately, so as to avoid any such situation as that from which they are suffering at this moment.
We are entitled to have a much more exact statement as to the significance of Clause 6 than we have had so far. The right hon. Gentleman gave us only a very partial statement of the purport of the Clause. He told us that a board operating in Great Britain may be associated with a similar board operating in Northern Ireland. Clause 6 gives substantial power to a board in Great Britain to buy from a similar board in Ireland. We should like to know whether the large powers given under Section 5 of the original Act are sufficient to cover the powers given in Clause 6 of this Bill. Will a board, under the terms of Clause 6 of this Bill be able to exercise actual control over the output and the sale of Northern Ireland produce in the British Isles? Will the Great Britain Bacon Board have power at present, or on any future occasion, to limit the output in Northern Ireland or to limit the sale of Northern Ireland produce on the British market? The reply to that question is very important, for this reason. If the British Board, having taken the power of the Northern Ireland Board, have powers to restrict, either at present or in the future, output in Northern Ireland, anyone in Northern Ireland who may desire at this moment—and I am sure that hon. Members representing Northern Ireland will appreciate this point—to start a new bacon factory will be deterred
from doing so when they fear that a board in Great Britain may have the power to limit either production in Northern Ireland or the sale in England of Northern Ireland products; they will obviously hesitate before they erect another new up-to-date bacon factory which could produce bacon nearer to the need of the British market than is possible at this moment. I think the right hon. Gentleman might tell us more about' that side of Clause 6 than has been told us so far.
Further, when the Clause refers to a corresponding scheme in Northern Ireland, why should it not include a corresponding scheme in Wales or in Scotland? After all, the right hon. Gentleman has already had some experience of Scottish milk. The British milk scheme came into operation a month or so before the Scottish milk scheme, and be knows already that, because Scotland was permitted to enter into long-dated contracts for the sale of milk in Great Britain within the area of the British milk scheme, that tended to dislocate all the efforts and intentions of the British Milk Board. I do not see where in Clause 6 the point that I am putting is covered. Northern Ireland is specifically referred to, but no reference is made either to Wales or to Scotland.

Mr. ELLIOT: It will be found on page 4, line 13:
any other scheme under that Act or any scheme under corresponding legislation enacted by the Parliament of Northern Ireland.
The words:
any other scheme under that Act
would cover a Scottish or a Welsh scheme, because they come under the Act of 1931.

Mr. WILLIAMS: If the right hon. Gentleman's interpretation of those words is correct, the point is invalid—

Mr. ELLIOT: The hon. Member will also find it in the summary in front of the Bill.

Mr. WILLIAMS: I leave that point for further examination, but my reading of Clause 6 is that it deals exclusively with Northern Ireland, and we are anxious to see that no subsequent event comparable with the Scottish milk business shall be possible. There is one thing on which the
right hon. Gentleman seems to have been educated, following marketing schemes. If this Northern Ireland-cum-Great Britain arrangement can be carried through, and the British Bacon Board can take charge of all the bacon produced in Northern Ireland, import it into this country and make itself responsible for selling it, at least we shall have one import board established, and I hope the result will satisfy the right hon. Gentleman that he might usefully extend the operation of import boards to both producers and consumers in this country. I think he will appreciate that the criticism of the Bill has been fairly legitimate, and that many substantial and fundamental points have been raised. Clause 1 is of vital importance, and, unless we are thoroughly mistaken and have wholly misread it, it is of such vital importance that we think the right hon. Gentleman himself will have to re-read and reconsider the whole thing before the Bill is allowed to proceed through its remaining stages here and up to another place. The possibilities are almost beyond explanation.
Finally, I want to say that, while we appreciate the right hon. Gentleman's anxiety to restore agricultural prosperity, the long series of Measures that have been introduced into this House recently are extremely costly. We have had rating relief, and the sugar-beet subsidy; we had agricultural credits in 1928–£750,000 for 60 years free of interest, and £10,000 for 10 years towards expenses. We had the relief of railway rates in 1928; we had the Wheat Act, we had Customs duties, we had restrictions, and we had further threats yesterday, when the right hon. Gentleman must have been as happy as a bird. He was attending a meeting of the National Council of Agriculture, and a report of that meeting states that he said to a. body of farmers-a body of producers:
Do you say to me here and now that some regulation of Imperial as well as foreign supplies is essential if agriculture is to survive? 
The farmers replied with loud cheers, "Yes," and the right hon. Gentleman said:
I take that as a unanimous finding of this meeting.
That unanimous finding of farmers in favour of restricting imports either from
the Dominions or from anywhere else, that sort of reasoning on the part of the right bon. Gentleman and many of his predecessors, has been extremely costly, not only to the consumer, but also to the taxpayers of this country, and, while all these rating reliefs and the rest may help the farmers, there is a good deal of ultimate doubt about it. What we are certain about is that the right hon. Gentleman is going to guarantee to landowners their rents, and we are equally certain that their rents are to be guaranteed at the expense of the consumers in this country. Some day we are hopeful that there will emerge a Minister who certainly will have dictatorial tendencies, who will follow the lead given by the present Minister of Agriculture, but who will have some real courage, and who, having seen the necessity for marketing and planning, and having realised the impossibility of this individualist system either in production or in sales, will have the courage not only to nationalise the land, so that any money expended will at least return in value to the State, but also to socialise agriculture so that. there shall be no losses and so that there shall be no profits—

Viscount WOLMER: There certainly will be none.

Mr. WILLIAMS: —so that people will be paid for services rendered, without constantly pleading, as the Noble Lord is never tired of doing, for putting farmers on the dole, and without the landowners being made perpetually the biggest dole receivers in this country.

9.4 p.m.

Sir FRANCIS ACLAND: I did not know, until the hon. Member for Don Valley (Mr. T. Williams) began to speak, that Sir George Edwards had passed away to-day. Very few people really knew him as "Sir George Edwards," but many thousands of people knew him as plain "George." Anyone who knew him, as I had the honour of doing, must feel, now that he has gone, that he has lost a personal friend. He was one of the most genuine, modest, single-minded and lovable men that I have ever known, and his passing is really a great loss to thousands of people who almost loved him, as so many did.
This is a most remarkable Bill, and the more I look at it the more remark-
able I feel it to be. Apart from Clause 6, which meets a point which has arisen since the earlier Act of this year was passed, it is necessary to meet a comparatively small issue which has arisen, namely, that the contract prices which have been fixed for bacon were found to be too high to carry the amount that was actually contracted for and, therefore, payment has to be made—I do not think the Minister has ever stated how much, but it is stated outside to be something up to £500,000—to cover the anticipated loss of the curers.
One would think that could have been put right in a simpler way than three pages of a Bill—I am taking out Clause 6—which never seems to get near that simple point that has to be met. I know that the ways of draftsmen are wonderful and extraordinarily brilliant and clever, but I think the draftsman of this Bill must have had a bet with a friend that he would draft three pages of a Bill without ever remotely touching the simple point that has to be dealt with, which is that the Bacon Board has to be empowered for some period less than a year to borrow money to pay the estimated losses of bacon curers, the losses to be made up by cutting down contracts later on. Do we really need three pages of a Bill to put that right? But we have to take the Bill as it is and realise that it is not confined to that point, which is the only point that the Minister put before us, except for Clause 6. Many of these Clauses are not in any way connected with this emergency, and we have to look at them as being made for all time and to do what the hon. Member for Don Valley did, examine what the effects of them may be as regards other schemes and in their general application. We have to do that the more because the House has no control over these operations except on these occasions when we are considering these Bills.
When the actual schemes come before us we have no control at all. We have to take them or leave them. They are not the Government schemes, but the schemes of the farmers. They are brought up, as the milk one was I think, after eleven on the last day but one of a Session, and we are told it is necessary to get the thing to work and, if any objection is made, the whole scheme will have to be withdrawn, and they will not be in time for the autumn contracts. The House has
no power then. Now is the only time that we have power to examine the sort of schemes that they are going to be.
I do not interpret Clause 1 in quite the same way as the hon. Member who spoke last, but it opens out rather large new possibilities. It enables a scheme to provide for empowering the board in such class of cases as may be specified in the scheme to pay compensation to producers in respect of any loss which, in the opinion of the board, has been occasioned to such producers by the operation of any scheme whether administered by that board or not, that is, loss occasioned by the operation of any other board or scheme. It is a great pity to give wide powers of that kind. You are apparently aiming at doing a perfectly simple and definite thing to meet this perfectly simple and definite emergency. The farmers are puzzled about these schemes and a. little suspicious of them. They welcome them certainly from the point of view of improving their output. That was the result that I had hoped for from the pig scheme, and I am glad it seems to be coming along. But it seems to me that you endanger soundness and you risk arousing the suspicions of people under these schemes as soon as you begin to put into them the possibility of all sorts of claims being made and all sorts of disputes and grievances arising if those claims are not met, not only claims arising under the scheme itself, but claims in respect of the effects of other schemes.
It seems to me that, although the power will rest with the people in charge of the pig schemes, this opens the door to the possibility of people who have been aggrieved and have suffered loss under a pig scheme because of something that has happened, namely, an increase in the price of their raw material, whether potatoes or buttermilk or barley meal or whatever it may be, coming not to the other scheme but to their own pig scheme and saying, "I have suffered loss because of the operation of some other scheme, and I want compensation under this scheme."I do not like bringing in this new and, I think, dangerous and rather unnecessary power simply to meet this specific case. After all, when a man has taken a contract, if it is a building contract, and the cost of bricks goes up, he does not say, "I have a claim against the people with whom I
made the contract." If he has provided against a rise of price or wages, well and good. If he has not, he takes the rough with the smooth. These wide, new, general powers are giving people apparently a, claim because they may have had losses because of the operation of some other scheme. I think it is a dangerous departure.
Clause 2, it seems to me, we shall have to regard, if it is passed, as part of the general law affecting all these schemes. It gives power to boards to lend or grant one another money or to guarantee one another's loans. Again, I find it very difficult to reconcile that with the directness, the simplicity and the definiteness which is so desirable in the financial affairs of these boards. What publicity will there be when this sort of thing is done? We have not been able to get any publicity as to the amount of money involved in these operations between the Bacon Marketing Board and the Pig Marketing Board. We only know in general that something has had to be done. What publicity will there be for these loans or guarantees? There will be reports and rumours and, maybe, leakage, but no real publicity, and that is bad for a scheme. There is sure to be suspicion when big operations are taken on by the Government, but you do not want that suspicion to be any more than is necessary.
The Clause says these loans or guarantees shall only be made voluntarily by one board to help another. One can imagine what will happen. A board will get into financial difficulties, as has already happened with the first scheme that has been started for bacon, and pressure will be brought to bear by persons in authority, who will say, "If there is too much said about this, if this board goes down, it will endanger another. You will all be blown upon if you do not take care. If you do not lend this one that is in difficulties money or guarantee its loans, the whole facts will have to be brought out in some specific way before Parliament, and you will all feel a draught."
I think that is altogether a wrong sort of line of country to get into, and it is all wrong that indirect pressure should be able to be put upon boards to come to one another's rescue. I do not think
it is going very far to imagine that sort of thing arising. The argument will be used that one board will make a little more or less this time, and the difficulty will blow over. That is the sort of thing I want to avoid. Sometimes if you spread your risk over several organisations you decrease it, and it is a legitimate thing to do, but once you pass this general Clause to he embodied in our permanent legislation, you will be letting each board feel in future that all the others will be almost morally bound to give grants or loans or to guarantee their liabilities. You will be tempting those boards to do what has been done by the pig, marketing, and bacon boards, namely, fix contract prices too high really to be a businesslike proposition. As soon as you let people know that other people can be relied upon to come to their rescue they will be very much less careful about their contracts with their own members and so on than otherwise they would be. The only way in which farmers can be got to trust to these schemes is that each scheme should be on an independent basis, and there should be no sort of expressed duty of one coming to the rescue of another. That sort of thing is too suggestive of the less pleasant side of business finance in which one company controls another and operates through it and is practically the equivalent of another under a different name, to the surprise, and very often to the loss, of the investing public.
I come to the more ad hoc Clauses. As to Clause 4, with regard to which there is a time limit of one year, whether there is anything in the scheme under which a board is set up to that effect or not, it means that the Minister is bringing in a new element into the matter. The Minister may empower any board to guarantee any loan which any other board has had to contract. The Minister is going to bring into these schemes, without any alteration or without resubmitting them or anything of that kind, an element and a liability about which those who had made the contracts under the schemes would know nothing at the time the contracts were made. That is not the sort of thing farmers like. They will be inclined to say: "When we made these contracts, did we know that our money was to be lent, or that our guarantee was to be given to another board? We did not. That was not in
the scheme. It was not in the Act of Parliament under which the scheme was produced. It was not stated on the form of our contract, and we do not like it." That brings me again, as all these considerations do, to prefer the direct. method and to say "a certain slip—I do not like to call it a mistake—a miscalculation has occurred on the subject of bacon, let us put it right without these extensive legal procedures."
I do not intend to say anything about Clause 6, but with regard to Clause 5 I wish to ask the Minister a question which has been puzzling me a good deal. He rightly and inevitably referred to Sections 13 and 16 of the original Act of 1931—the short loan Section and the long loan Section. If he will look at the Financial Resolution which is to be moved by the Financial Secretary to the Treasury presumably later on, he will see that an entirely different Section of the Act of 1931 is referred to. The Financial Resolution refers to an increase in the expenditure authorised under Sub-section (5) of Section 11 of the main Act. That Subsection enables you to write off as irrecoverable balances of agricultural marketing boards' funds. Why is there that reference to increases in the balances irrecoverable which may have to be wiped off the funds of these boards? Why is the Financial Resolution drafted in that way? As far as we can see from the Bill itself, and from the explanation of the Minister, it is merely a question of aiding the amount which was allocated for purposes of starting schemes in Section 13 of the Act.
Let us see what is contemplated. I wish we really knew. We only have the report to go upon. It is expected, in the words of the explanation of the Bill, that pretty nearly all the money which was originally allocated to purposes under Section 13 of the original Act will be wanted to clear up the bacon difficulty. The facts as they have been told to me are that you may have to pay bacon curers up to £500,000, whereas the amount of money available under Section 13 is £625,000. Where are we? One point is clear. You are cutting to the bone already with regard to this one thing which has gone wrong—this miscalculation. You are cutting to the bone the sum provided under the Act of 1931 for starting these schemes. That money will
have to be put back later presumably, and made available under Section 13, either by forcing up the prices or by lowering the contract prices later on. If you force the prices any higher you will not be able to sell the bacon, but if it is going to be done the other way by lowering contract prices, it will amount, as far as I can make out, to a lowering of about ls. a score in the next contract period, assuming that there is, as there very likely will be, a contraction in view of the fact that this money has not been paid back.
The Minister is wrong in saying, as he definitely said, that this sort of thing was contemplated when the main Act of 1931 was passed. I have been looking up what Dr. Addison said. He did not contemplate this sort of thing at all. He naturally and inevitably contemplated that money would be required as these schemes came into operation, and before they were in a position to make any levy upon the producers either for taking their offices, or for paying salaries for the first quarter, half year or year, until their contracts came in and they had been paid for the stuff which the schemes had produced. I saw the other day that the Milk Board was almost boasting of having 150,000 letters arriving every day for them to deal with. That was the sort of thing for which this money was rightly and inevitably provided. No words can be quoted by those responsible for the original Act to suggest that they had in mind the loss of £500,000 on a particular scheme which should be made up out of £625,000, which was the total amount of money to be provided for all the schemes which could be floated under the Act of 1931.
That, again, brings me back—I am sorry to repeat it so often—to the point that it would have been far better to deal with this particular emergency in a particular way without raiding the fund, which was established for quite different purposes. I should not have been so suspicious about this Bill unless we had had a rather curious background against which to consider it. The Minister visited Sadler's Wells Theatre two days ago to see a performance of Bernard Shaw's play "The Devil's Disciple." In that play the hero declares himself to be a scoundrel, devoid of any principles of morality or religion, while he is really, like the Minister, a rather fine fellow at
bottom. The Minister, apparently, was so moved by the representation of a man blazoning his sins abroad to the world that he dashed on to the stage between the acts and made a profession of his evil intentions which has not yet been quoted to the House. He said:
We have taken some drastic steps, but they are nothing to the steps we are going to take in the immediate future. As the road notices say, 'You have been warned.' This movement will not stop until we have had a lot of terribly nasty food at extremely high prices.
This evening his phrase was very different. He was describing how much more cheap food there would be available in this country owing to the increase of the home supply of pigs as compared with the imported bacon. He put it before us in a very different way. He said that this scheme would mean cheap, fresh, edible by-products. There was no mention of "a lot of terribly nasty food at extraordinarily high prices." It was very lucky for him that the gallows which is on the stage during the third act of "The Devil's Disciple "was only a property gallows, and that therefore he was able to get away after that extraordinary declaration. But it is rather extraordinary, and we must associate this Bill with it: "Nothing to the steps we are going to take in the immediate future." He said that two days ago, and it is the immediate future we are now living in. I do not like this idea at all. If this food about which he is talking and for which he is preparing us is, as he says, to be terribly nasty, one thing is certain: it will not command very high prices. This is the essential fact which the Minister is tending to overlook in all these schemes. Unless and until he controls everyone by rations, if the food is either nasty or expensive people will turn to some other sort of food which is cheaper and nicer.
It would have been better in the long run to avoid this difficulty altogether. You could not tell how big the contracts were going to be; you expected 200,000 cwt. and you got 300,000 cwt. Your scheme is charged with a fairly heavy debt in consequence; that debt will have to be repaid by cutting the contracts later on. That will cause, I am afraid, a good deal of mistrust and a good deal of shrinking away from making the contracts at the time when this repayment
has to be made. It would have been better to cut down those contracts—the contracts sent in by the small men—in order to bring them within the ambit of what was expected and planned for. It could have been done without a loss in accordance with the report of the Lane Fox Commission. One sees already that the failure to do that is causing difficulty. The meeting of the Council of Agriculture has already been referred to, and there a big pig-breeder, Mr. T. C. Ward, of Shropshire, moved a very stiff resolution of protest against the proposal to do what the Minister is now doing, namely to deduct from the next contracts the amount of loss on the first contract, believing, as he said, that
such deductions would directly violate a principle in the original scheme upon which pig producers so recently voted. that they would be looked upon as a definite breach of faith and have a serious effect upon the expansion of production.
That shows which way the wind is blowing. I believe that in all these schemes, if they are to succeed—and I think there is a great deal of room for some of them to succeed and I should be glad if some of them did succeed—even if organisation has to be created slowly and you have to restrict supplies from abroad, you should do it gradually; do not rush into big contracts involving losses which can only be dealt with by Bills of this kind. That is not the quickest way forward, that is not really sound; and when, owing to action of that kind—making these schemes run before they have learnt to walk—this sort of thing comes along, the only protest we can make is to vote against it, so as to prevent this sort of thing being done in schemes on future occasions.

9.32 p.m.

Sir WILLIAM ALLEN: Just for a moment I should like to intervene in this Debate, the more particularly as there is some reference in this Bill to Northern Ireland. I listened with more or less pleasure to the speeches of those hon. Members who have taken part in the Debate; with less pleasure to the speech that has just been delivered from the Liberal benches. It is a copy of some speeches that have been made in Northern Ireland for some time past, a kind of prophecy of all the evils which will happen if such a Bill is put through. Such prophecies of evil for the future always remind me of the old gentleman
who, on his death-bed, called all his surviving relations round him and said, "I have had a great deal of trouble in my life, but most of it never happened." That is exactly the impression which the speech of the right hon. Member who has just sat down has made upon me. All kinds of prophecies of that nature were made by individuals who had no hope of any success for the pig-marketing scheme of Northern Ireland. For a little while it looked a dangerous scheme, but I should like to advise the right hon. Gentleman the Minister of Argiculture not to be rushed by the scheme's apparent failure at first, but to take it quietly and to see how it works out. I have no doubt whatever that the result will be satisfactory to himself as Minister of Agriculture. In the recent election of Northern Ireland there were a number of gentlemen who said that because of the Government's marketing scheme they would oppose the Cabinet Ministers of 'Northern Ireland and more particularly the Minister of Agriculture, but, as time passed and the scheme was proved to be an excellent Measure for the people of the country, that opposition gradually subsided, and the result was that not one member of the Cabinet of the Government of Northern Ireland was opposed in the late election. I should like to throw out that hint. I would ask the right hon. Gentleman not to be disappointed if at first he does not succeed.
I listened with pleasure to the speech of the hon. Member for the Don Valley (Mr. T. Williams), because I always enjoy the moderation with which he delivers his speeches, although they may be entirely in disagreement with my own opinions. There is a refreshing moderation about everything he says, but, like a great many other speakers, myself included, in dealing with a subject of this kind, there are little errors into which one is inclined to fall, and the hon. Member did fall into some errors in regard to the First Clause when he frequently referred to it as a guarantee against all losses. I cannot read it in that way. I read it as enabling a scheme to provide, etc. It is purely, from beginning to end, an enabling Bill. That is the only way I can read it, although I may be wrong. I do not profess to be right, any more than the hon. Member.
With regard to the question which has been raised as to the inclusion of North-
ern Ireland in the Bill by name, while Scotland and Wales are apparently left out, it seems to me very clear from the first page of the Bill that both Scotland and Wales, as well as Northern Ireland, are included. It is refreshing for a Member from Northern Ireland to see that some notice is taken of the fact that Northern Ireland is part of the British Empire. We are so often taken as aliens. [HON. MEMBERS: "No.''] Yes. Not long ago I was sending a telegram to Belfast from a Post Office in London and, as it was less than 12 words, I put down one shilling, but the attendant behind the counter said: "Sixpence more please, for the Free State." I think that goes to prove what I have said, and it is interesting to me on an occasion like this to defend the proper position of Northern Ireland as part and parcel of our great Empire. We have constantly to remind people of this country of that fact. Therefore, I am glad of this particular reference in the Bill.
Clause 6 is one of the most essential Clauses in the Bill and we appreciate the introduction of Northern Ireland as part of the scheme. Our Agricultural Board in Northern Ireland has had many interesting things said about it in regard to the grading of eggs and apples and the pig marketing scheme, all of which are working out for the benefit of the people. We have seen no evil results with regard to the price of bacon. Of course, everybody knows that Irish bacon is the best in the world. We have seen no advance in price because of our marketing scheme, and it is a fallacy to suggest that there will necessarily be advances in price because of the present Bill. It is absolutely necessary that where there is a board in Scotland, in Wales, in England or in Northern Ireland it will be essential that all those boards should work in harmony, otherwise you may have the board in Northern Ireland dumping potatoes, bacon, eggs or apples into Scotland, Wales, or England at a very much lower price than the board in those countries may fix. If, however, we have all the boards acting in concert the result must be very much more satisfactory. I congratulate the Minister of Agriculture on the Bill and I assure him that I have no doubt that, given a little time, this scheme will work satisfactorily for all concerned.

9.41 p.m.

Mr. HOROBIN: I was one of the comparatively few representatives of industrial constituencies who was on the Standing Committee when the Minister of Agriculture's Marketing Bill was going through Committee upstairs, and I think I can say that almost on every Clause one made such criticisms as one could, and ventured to give some warnings. Of some of those warnings I reminded the House last week. Although the Minister of Agriculture was not able to be present on that occasion, perhaps he has seen what I said in the OFFICIAL REPORT. I rise as one of those who are still loyal supporters of the National Government who, with much misgiving, voted for that Act and each Clause of it upstairs. Having swallowed that camel, I shall vote for the Second Reading of the Bill to-night, but I should not like the Minister to be under any misapprehension that the course upon which he has set himself is not causing grave disquiet to some supporters of the Government in this House and to a great many persons who voted for the Government at the last election.
Reference has been made to a rather remarkable general statement of the Minister. The disquiet to which I have referred is not only confined to the curious views of the right hon. Gentleman and his attitude about consumers, but similar causes of disquiet arise among business men. I should like to quote the opinion of one of the greatest industrialists in the country, the chairman of United Dairies, who said, recently, of another board similar to the one we are discussing:
The use of its powers will determine whether it stands or falls. Under its constitution the board has to consult the buyers before fixing prices. It would be a misuse of the word to describe our recent attendance at the hoard as consultations.
What is the origin of the Bill? It takes its first parentage from that very Socialistic measure the Agricultural Marketing Act, 1931. That Act gave powers which at that time appeared to Conservative and Liberal Members as peculiar. It empowered boards to buy products, to produce commodities, to sell, grow, store, adapt for sale, insure, advertise and transport them—the sort of public enterprise that we have had to deal with this afternoon in connection with the New-
foundland Bill. That same form of enterprise was carried forward by the Minister in his own Act of this year, almost word for word.
It is indeed a universal peculiarity of these courses that they grow more involved step by step; here they go first of all from what are called primary products, like pigs, to secondary products such as bacon. The Act of 1931, because it did not control imports, was largely a. dead letter. The Act of 1933 did; and the schemes began. With the schemes came, as usual, the losses, and we are now asked to pass an Agricultural Marketing Bill, No. 3, Clause 1, of which characteristically is to provide payment for compensation for losses, and Clause 2, equally characteristically, is to provide power to make loans towards deficits. How far is all this to go? How far it can go we can see by experience on the other side of the Atlantic. There is an active gentleman there who corresponds to the Minister of Agriculture in this country, who has piled up a little Bill of 1,000,000,000 dollars on the consumers of the United States for the benefit of the producers, by such measures as those contained in the Wheat Quota Act and other measures of the right hon. Gentleman. These schemes can go very far. Like all planning they rest upon two noble principles; squeeze the taxpayer and damn the consumer. And what is the justification?
This is the first speech I have heard from the Minister of Agriculture in which he has not used the word "glut", though it is never far from his thoughts. Whenever he is in a tight place he tells old-fashioned believers in private enterprise that they are out of date, that this is the day of glut. If that is so, why does he propose to add to the glut? We have had in operation, as our first experience in this country, one of these noble schemes to improve industry and get over the troubles of glut. The first effect has been to add to the glut. The right hon. Gentleman may say that it was not done purposely; "You must not blame me for being surrounded with this beautifully regulated but very expensive litter of Gadarene swine; it was a mistake, I did not mean it." In the old days if any private firm made a mistake of that sort the bank would have come along and put someone on the board to see that it did
not happen again. Nowadays, the Government have learned a trick worth two of that. Already on the other side of the Atlantic, and from what we can know of the right hon. Gentleman's mind it may also be true here, the Government comes along and puts someone on the board of the bank to make sure that they can do it again, and borrow more money in order to make it possible. Taking a planner past a bank is like taking a dipsomaniac past a public-house; he must go in and taste the overdraft.
Within six months of the first of these magnificent new schemes being in operation a deficit has begun, loans have to be incurred, and viewing the courageous and frank public statements of the right hon. Gentleman, and also the practical experience on the other side of the Atlantic, it is about time that persons, who are only too willing to support a Government which has endeavoured to put our finances straight, should ask themselves where this is all going to lead. We had a remarkable speech from the hon. Member for Stockton-on-Tees (Mr. Macmillan) the other day in which he told the Front Bench that the period of salvage was over and the period of reconstruction begun. Thoughtless hon. Members applauded that remark. It is fair to remind hon. Members that what we had to salvage two years ago was the result of 10 years of reconstruction and the last thing done by the Government upon which we had to start salvage was the Agricultural Marketing Bill of 1931 upon which all these measures are founded. I put it very seriously to representatives of agricultural constituencies whether they are well advised in basing their hopes of agricultural prosperity on measures which more and more are being shown here, and across the Atlantic, to be practically incompatible with sound finance, and with a reasonable regard for the consumers of the country, who enormously outnumber the producers of agricultural food.
Let me remind them that just as the difficulties of the wheat farmers across the water were due to a Government guarantee of a ½ dollar wheat, and we know where wheat is now, that just as the wheat farmers in this country had the Corn Production Act guarantee upon which to endeavour to base advances in agriculture, and we know how long that lasted; so they cannot hope in this
country, mainly of urban and industrial constituencies, to base agricultural prosperity upon, I will not say the extraordinary words of the Minister but upon scheme which produce bacon of the kind people do not like, at prices which they cannot afford, and with the open and avowed object of reducing the opportunities for the very hard-hit industrial exporting districts to make a living, whereby they can buy anybody's bacon. On the other hand, I ask Members of the House whether they are interested in agricultural production or in any other form of production, whether they are not beginning to get a little nervous of the extent to which these socialistic interferences in agricultural economics are more and more openly about to be made a precedent for interference in other industries.
It will not be long before schemes in cotton and steel will be based upon similar Acts of Parliament, all of them producing their own little deficits, all of them calling for their own little loans, and all of them calling for an endless application of interference in private enterprise. I understood that this Government was called in in desperation to preserve private enterprise, by a, country which had too long suffered from a practical application of a philsosophy of industry which, I submit, is perfectly represented in the Agricultural Marketing Act, passed by a Socialist Government upon which all this new agricultural policy is based. The time has not yet come when I can feel at liberty to vote against the Government upon a Measure which follows logically from a major Government Measure to which this House has assented, but I submit to Members of different convictions who support the Government that the time is rapidly coming when we shall have to decide whether we have not merely substituted, or are in danger of substituting, for e pusillanimous and incompetent Socialist Government what is far more dangerous, an exceptionally active and bold Socialist Government.

9.55 p.m.

Sir ERNEST SHEPPERSON: in rising to speak on this Bill I cannot say to the hon. Member who has just spoken that he is quite right in his statement that many agriculturists are somewhat fearful of what will be the ultimate result
to their industry and to the country of having to submit to the various methods of control of their industry. I suggest to him that the agriculturists of the country realise that if it were not for these Measures British agriculture would go under; and it is because they feel that these Measures will save them and their industry that they support wholeheartedly the proposals that we are having brought before the House. I would like to express my sincere thanks to the hon. Member for Don Valley (Mr. T. Williams) for the very clear way in which he enumerated the various Measures of benefit to agriculture that have been passed not only by the National Government but by the previous Conservative Government. We are very happy to know that we have that appreciation from him. It is for these reasons that the agriculturists of the country appreciate the present Minister of Agriculture more than they have ever appreciated any previous Minister; and I want on behalf of agriculturists to thank the Minister for his activities during the last two years.
I would like to add my testimony as to the benefits which this particular scheme, or these various schemes, have brought to agriculture. If one goes to-day to a market town and meets those concerned with cattle and the selling of cattle, one feels rather distressed and sad. Bat it is pleasant to proceed through the cattle market to the pig market and there find cheery smiles.

Mr. LANSBURY: Do you not mean squeals.

Sir E. SHEPPERSON: Smiles on the faces of the farmers and squeals from the pigs. It is pleasant for us to see that amongst our constituents. We realise that it is measures of this description which have brought those smiles to the farmers' faces. We hope that it will not be long before the Minister is able to turn to smiles the rather sad look on the countenances of the farmers selling cattle. These schemes have aroused a great deal of interest in the agricultural community. The Minister has mentioned that there is a great demand for weighing scales. The farmer recognises now that he has to develop his pig production on financial and economic lines. He is
also concerned with the variety of pigs that he should breed. He goes to the Minister or to the Minister's Department to discover what particular variety of pig is most suitable for bacon production. He can do as I did, that is, obtain information that a large black mother is the most essential article to breed from. The information that he gets is a very great help to him. To-day if one goes amongst a body of farmers one hears discussions as to the albuminoid ratios, the proteid equivalents and the carbohydrate equivalents in various foods. There is great interest in producing the greatest amount of live weight for the least food consumption.
I seriously support this scheme, though in doing so I must add some words of criticism. My criticism is that it is always the producer who pays. Not many days ago the Minister, in referring to the scheme for marketing bacon, said that owing to the regulation of imports the wholesale price of imported bacon had risen 26s. per cwt. In the same speech he said that the British producer of pigs had received the advantage of 2s. 6d. per score -.1n increased price. According to my calculation the producer has received an increased price of 14s. 2d. per cwt. But the price of bacon has gone up by 26s. cwt. It appears to me that there is an excessive gap between what the producer receives and the price at which the bacon is sold, and that that is quite sufficient to enable the curer rather than the producer to pay; there is sufficient in that gap to meet the cost of these schemes.
The hon. Member for Don Valley made a suggestion that possibly for the next contract period the figure would be lower. I suggest to the Minister that there is no necessity for any lower figure when bacon prices have risen 26s. per cwt. and the price of pork is only 14s. 2d. per cwt. more. There is an ample margin there for the curer still to pay the present contract price. I hope that the Minister will take what action is possible to safeguard the producer, so that he shall not get a lower price. I sincerely support the pig-marketing scheme and this Bill. It has been the one bright spot on the meat-producing side of Agriculture, and I hope it will give the right hon. Gentleman the necessary courage to afford to other forms of meat production the same help that he has given to pork.

10.5 p.m.

Mr. McKIE: The hon. Member for Don Valley (Mr. T. Williams), in moving the rejection of the Bill, alluded to the amount of Parliamentary time taken up in discussing the subject of agriculture. I am sure that all the Members in the House will agree that we have by no means consumed too much time on that subject and I do not think my friends the farmers would say that we have taken nearly enough time. In the discussion on this, the second Marketing Bill produced by the National Government, we have had, as we always have on these occasions a very interesting Debate and my hon. Friend the Member for Leominster (Sir E. Shepperson) has made one of his characteristic interventions in an agricultural Debate. He will forgive me if I do not follow him into all the intricacies of pig production in Herefordshire or anywhere else. Before him we had the hon. Member for Southwark (Mr. Horobin), who gave us and the Minister a warning. In fact he was positively gloomy about the situation and even suggested that the time might shortly come when he would have to reconsider his support of the Government. He pointed to America as an example of what might happen here if we persisted in following their lead, as he suggested we were doing. I do not know how he can imagine that we are following the lead of America because not so long ago he was congratulating the Chancellor of the Exchequer on pursuing the path of financial rectitude.

Mr. HOBOBIN: I admit that we are being saved from being completely planned to death by wild Conservatives, by a few solid Members of the Government.

Mr. McKIE: My hon. Friend agrees that we are not yet in the plight of America, and, as he has said he is going to vote for us to-night, he still thinks the Government fairly sound upon agricultural policy as well as upon finance. He rightly pointed out that this island is predominantly urban and industrial, but he did not go on to say that during 80 years we have been content to let the agricultural industry work out its own salvation. We have over developed the industrial and urban side, and I would suggest to the House that it is for that very reason that we are now considering
all these schemes to assist agriculture. I do not share my hon. Friend's gloomy views, and I sincerely hope that in the end it will be seen that he is wrong and not the overwhelming majority of the Members of this House. I think he suggested that if industry is in a prosperous condition it necessarily follows that agriculture will also be prosperous, but in the 80 years during which our industries developed in such an extraordinary way and became the amazement and envy of the rest of the world, agriculture continued to languish until it was finally landed into the deplorable condition in which it is to-day.
The two Clauses of this Bill most discussed have been Clauses 1 and 6. On Clause 1 both the hon. Member for Don Valley and the right hon. Gentleman the Member for North Cornwall (Sir F. Acland) had some trenchant criticisms to make. The right hon. Gentleman naturally finds that his political allegiance is concerned with strict financial rectitude and he has fears, shared by the hon. Members above the Gangway, as to the advisability of voting for the Bill because of the money which we shall be asked to find under the terms of the Financial Resolution. A few hours ago we were considering the advisability of voting large sums for Newfoundland, and I think the right hon. Gentleman the Member for North Cornwall was in the Lobby with us on that occasion.
I do not suggest that there is no risk in Clause 1. There is certainly risk, but I do not think that any hon. Member has suggested that the risk might be obviated if the machinery under the Agricultural Marketing Acts was fully requisitioned. I refer, of course, to the control of imports. That point has been mentioned several times, but not from the point of view which I am advocating. I think anybody connected with agriculture would agree that no marketing scheme, whether for bacon, potatoes, milk or the all-important meat, can be a success if it does not provide for systematic careful regulation of imported products. The Milk Marketing Board have indicated in the last few days that there may be a large surplus in the early spring. That has given milk producers food for serious thought because surplus milk which cannot be disposed of as liquid will have to be turned into manufactured products.
It is all right on the face of things to say you can dispose of a surplus in that way, but if the flow into this country of cheese and butter is to continue in its present unregulated or insufficiently regulated fashion, you will simply be piling up greater quantities of manufactured products in this country which cannot be disposed of at anything like remunerative prices. Therefore, I would suggest to my right hon. Friend, who spoke in very strong terms about beef a day or two ago, that he and the Government and those connected with working these marketing schemes should tackle very seriously indeed the question of the supplies of cheese, butter and milk products, which are coming into this country, not merely from foreign countries, but from inside the British Commonwealth of Nations as well. The words which my right hon. Friend used a day or two ago have already been quoted in this Debate, though they were quoted in criticism, but I would like to add my thanks to him for speaking in such strong terms as he did, and I would associate myself with what the hon. Member for Armagh (Sir W. Allen) said, that the Minister need have nothing to fear from the consumers if he takes the action for which we who represent pre-eminently the producers ask. I am certain that the electors of Kelvingrove will not pass any strict censure upon him at all.
Clause 6 has also been criticised by some hon. Members, and the hon. Member for Don Valley especially went rather off the rails, because he interpreted the Clause as meaning that only Northern Ireland was to be brought into co-operation with Great Britain. As the Minister rightly pointed out, both Scotland and Wales are included in the powers here given, and I am particularly glad that Scotland has been brought into this cooperative scheme, because as the hon. Member for Don Valley rightly pointed out, we had a certain amount of trouble some two or three months ago with regard to matters that required adjustment between the English and Scottish boards. In big schemes like this we cannot expect to run smoothly right away. There are minor and major points too that require -to be adjusted before the scheme can work in the way that we would wish. We 'had these points of difference, and some people possibly realised what might hap
pen if we had fiscal autonomy in Scotland. I do not think hon. Members need fear to give this Bill a Second Reading. Its passage this evening is, of course, assured, and I would ask the House to sanction it, because believe that the Bill is designed to supplement the Measure that we passed in May or June of this year, that it will ensure the smoother working of the greater Act, that it will make for increased efficiency, and that it will let the producer and the consumer alike know exactly where they stand.

10.18 p.m.

Mr. DAVID GRENFELL: If we on this side paid attention to our own advantage, we would rather welcome the appearance of this Bill. Those who sat in the Committee on the main Bill will remember how frequently we called attention to the shortcomings of that Measure and warned the Committee and the Minister over and over again of the danger of making too much haste in setting up the machinery under that Bill. We questioned the wisdom of the Minister in giving the board too much power in the initial stages of the transferring operations, and we constantly expressed the need for a vigilant survey of marketing requirements and urged the Minister to rely upon the Market Supply Committee. We never failed to press the importance of Section:3 of the Act of this year, which we then said was in danger of being neglected and which was not given the very important place in the reorganisation plans which it deserved. That Market Supply Committee is in the Act, but it was not given sufficient powers. Here is an example of the wisdom of our forecasts in the discussions upstairs when we said that any neglect of the authority and of the great usefulness of that committee would be reflected sooner or later in the confusion in our markets.
We instanced examples that can be clearly applied to the present situation. I remember that We urged that there should not be an undue restriction of imports. We pointed out the possibility of too much emphasis being given to the protection of home producers and said that it would put too much tax on our own industry to supply the short market which would follow on undue restriction.
We also urged the need for the careful building up of the various protective factors of the home market in order that we should go steadily forward year after year in building up and increasing the productivity of our greatest of industries. We urged the Minister not to be too rash with overseas countries, or too heavy in the imposition of the quotas which would limit supplies in our home market. We find that to-day our forecasts have been amply fulfilled. There was an undue limitation of the supply of bacon products into this country, an excessive restriction which was reflected in the abnormally and unreasonably high prices which followed the quota first fixed under the Act. We now find that something else has happened. The supply of home bacon has become unexpectedly high.
No one can deny that this is a piece of emergency legislation. It was not contemplated when we left the Committee stage in May this year. It is due to the unexpected appearance of too many pigs. No one contemplated that the home production of pigs would reach such a high figure, but the undue restriction of foreign supplies of bacon called forth pigs which were produced by the registered producers like a conjuring trick. They produced 600,000 pigs because the prices were high, and they were given the unexpectedly high price of 12s. a score on the large number of pigs which were to be delivered in the next few months. This emergency is due to the fact that bacon prices, having been raised to a high level, havenow fallen again. This vast quantity of prospective bacon on the market has caused bacon prices to fall, and the bacon-curers, who contracted to 12s. a score En the expectation of high prices for the bacon when it was cured, now find they cannot sell the bacon at that price. Too many pigs have made their appearance, too much bacon is in prospect, and prices have fallen to a very low level. We find the very strange position that the pig-producer and the pig-producing board are to help the curers, because the curers have contracted to pay too much.
Curers find themselves in the sorry position that they cannot compel the consumer of bacon to pay those enhanced prices, and therefore they say, "We are losing money under these contracts. They were entered into in the expecta-
tion of high prices, which the Minister had kindly arranged for us, but we now find those high prices are not likely to materialise and we have to disappoint our own members." Thereupon the Minister says, "I cannot allow this to happen at the beginning of my great marketing enterprises. If I allow the Bacon Board to lose all this money I can never get on with the other schemes I have in prospect. We do not know what lies behind the Minister's mind. He looks very innocent when we gaze across the Floor, but when we read his speeches the reverberations sound like thunder in the ears of all people who value freedom.
The Minister has brought this state of affairs upon this industry by his own action and is now seeking a way of escape, and he finds it in a previous Act, that of 1931. Dr. Addison has been charged in this House with many crimes and has been a very convenient whipping boy for the Government. He will be charged with all the defects of these schemes, though he is seldom given any credit for the advantages conferred by his Measure. He has conveniently placed all this machinery at the disposal of the right hon. Gentleman, who is going to use it. The right hon. Gentleman says, "It does not matter; we will meet this emergency. We have bargained to get £3,000,000 worth of bacon and we find it is £5,000,000 worth; but we will buy all this bacon and pay the price and adopt a simple arithmetical method of doing it." That is where the right hon. Gentleman shows his ingenuity.
Here I must make a reference to the hon. Member for Leominster (Sir E, Shepperson), because he was the only one to-night who has urged that there is no necessity for all this to be done. He says the farmer gets Hs. 3d. per cwt. for bacon, but bacon prices are 26s. per cwt., and asks, "Why should the bacon curers be empowered to borrow money from anybody 7 Have not they got enough money to meet all reasonable expenses and profits?" That being his view, the hon. Member ought to vote with us to-night rather than permit the possibility of a great loss of public money. The proceeds of this loan are to be handed over to people who buy at 14s. 3d. and sell at 26s. per cwt.—a very large margin for converting pig into bacon. We must thank the hon. Member for giving us that
information and for the definite way in which he has shown us that this loan is not necessary. The Minister says, "The Pig Board have got these contracts, and though the price is too high I cannot interfere with them; but the Pig Board, from their high prices, will lend money to the Bacon Board who pay them those prices." The Pig Board will lend money to the Bacon Board to enable the Bacon Board to pay the Pig Board's prices for the pigs supplied. That is very in genious. Only the fertile mind of a Scotsman could have thought of this method of manipulating things. After the Bacon Board have received the loan, they will pay compensation to their own members, and everything will be all right, and nobody will have lost anything.
I am still not sure that the Minister has taken us completely into his confidence. He may have a few more arithmetical mysteries up his sleeve. We are entitled to know—and I put the question to the Minister now, across the Floor of the House—if the money which is provided for in Dr. Addison's Act—I think it was in Section 11, has been drawn upon. It was a, sum of £500,000 for England and £125,000 for Scotland, making a total of £625,000, to be used as a send-off to the various boards, set them up and pay the initial expenses. If such a large sum of money is required, what are the prospects of future regulation? If the losses reach the whole of that £500,000, although we have not been told, and if the bacon curers are to be compensated to the full extent of their losses, those losses being due to bad estimates in regard to prices and market supplies, what shall we think if, on another occasion, some other board which has been badly advised by the Minister or, if properly advised, have not made full use of their knowledge of marketing requirements, should trouble this House and ask for another £500,000? Board after board will be encouraged to borrow money, in order to compensate everybody for losses.
This problem is getting beyond us. The Minister says, "All right; you can depend upon it that I will see that everything is in working order in these industries. A tribunal will be set up, on which three men will represent the Pig Board, three the Curers' Board and three will be impartial independent per-
sons. "He went on to describe this, and I will picture the whole scheme operating thus:
Three Pig Board men to look after prices;
Three bacon curers to guard against losses;
Three independents to see fair play,
While 5,000,000 of us pay, pay, pay.
The public will have to pay for all the nicely-balanced machinery, and for the impartial tribunal for the disputed claims of pig-producers against bacon curers. It must all end in higher prices, and the money will have to be found by the consumers, unless the Treasury is more generous than it usually is, and will foot the bill.
We protest most strongly against all this being done. I would like to know when this money is to be repaid? The Minister has not enlightened us, and we are entitled to ask for information from him. When the Pig Board has lent money to the Curers' Board, and Ole Curers' Board has compensated its members, something must come from somewhere. The money must be repaid at some point or other. How far is the circuit to go round, before it has made full circle? We should like to know something about the machinery by which repayment and recoupment is to be made to those who find the money. The right hon. Gentleman the Member for North Cornwall (Sir F. Acland) consulted the Bill, and he has helped us very much by his examination of its provisions. He asked a question, which I now with to repeat, and which was: "Will not these loans mean higher prices in the end? "We want the Minister to explain now, on the Second Reading of the Bill.
We shall oppose the Second Reading. We have not had the assurances that we seek, and which we are entitled to receive, and we are very much afraid that this reckless kind of reorganisation will, if the Minister remains in office, spread all over the country and that all our food supplies will be very strictly limited and determined, both in quantity and in quality. The Minister referred to that point in one of his recent speeches. We know that he believes that prosperity can only come to this country by a, policy of restriction. He does not apologise for that. The new economists have found in him a prophet daring enough to stand up to all public criticism, and reckless enough to adopt any measures which the
present Government, with its vast majority, can pass through this House.
Those who do not share the Minister's view or agree with the policy of the National Government fear that this system will be developed to a stage at which it will be very difficult to repair w1hen it goes wrong. There are grave risks with this huge unwieldy contrivance consisting of so many parts—a board here and a board there, touching the commodities by which people live day by day, and vastly influencing the prices and supplies of those commodities, determining exactly the quantities that the nation hall eat of this and that commodity, determining exactly to a halfpenny how much the nation shall pay. The Minister may argue that he is entitled to do this. Indeed, when we discussed the last question, he said he was not asking that a loan should be made to any other country; he was not asking that a loan involving any undue risk should be made. He said that this loan was a loan on good security, and was recoverable. He did not explain what the security was, or how the loan was to be recovered, and he gave no guarantee that it is to be recovered. He said that this was a loan to our own people, a loan to people to help themselves.
My hon. Friend the Member for Don Valley (Mr. T. Williams) quoted many examples which must not be overlooked and which must be present to the minds of all of us. We are handing out money, dole after dole, to this great agricultural industry, and there is ample evidence, which I challenge any landowner in this House to deny, that already farms have been let at higher rents than were obtainable 12 months ago. [HON. MEMBERS: "No!"] It is true; rents are rising; and if we continue to pour out money in this way it will ultimately find its way in large part into the pockets of the landowners. We shall vote against the Bill. We are not satisfied that it is justified by the circumstances, and in any case we say—it has been said by speaker after speaker—that it is a mistake on the part of the Government, a breaking down of their own scheme. We shall not vote for the Bill because we believe that with ordinary care and foresight this mistake need not have occurred, and it need not have been necessary for the Government to ask this of the House of Commons.

10.39 p.m.

Mr. ELLIOT: I can speak again only by the leave of the House. If that is granted, I shall be very glad to reply to the points which have been raised. I am sure that the Government have no reason to complain of the discussion that we have had to-night. It has been critical, but the remarks which have been made have all been made in a friendly spirit. We all agree that a great scheme of reorganisation is in progress, and critics from various parts of the House have rightly demanded information as to the proposal which the Government are bringing forward and have voiced fears lest. the Government should be going too far. It is, of course, not unusual that a warning against speed should come from a revolutionary party. "You are doing too much. You are going too quickly. We warned you in Committee to go slowly, but you are not going slowly enough. Go-yet slower." I apologise to them for the speed at which we have had to move. It is a thing for which we may have to apologise to them in the future also. We must try to justify our proposals on their merits, but we do not wish to defend them on the general principle that we are keying our efforts down to the year which they recommended to us in Committee and which they are now recommending on the Floor of the House.
The hon. Member for Gower (Mr. D. Grenfell) delighted the House with a very sprightly and interesting speech, but I could not quite make out whether he was complaining that food was too dear or too cheap, whether pigs were tap scarce or too plentiful. At one moment he claimed that there were not enough pigs and that he had warned me upstairs in Committee that there would not be enough, and then he put on a reproving air and said, "Now there are too many pigs. The industry has responded too well. You have bought pigs that you do not know what to do with."
The hon. Member for Don Valley (Mr. T. Williams) brought forward many points of reasoned criticism which demand attention. I think he started in some ways under a misapprehension as to the general purport of the Bill, a misapprehension which was cleared up in subsequent debate. He seemed to consider that it was a guaranteeing Bill, whereas, as the Bill itself says, it is an enabling Bill. He says it guarantees farmers
against losses. I do not think that that is accurate. It facilitates the possibility of a board making advances to another board, but it is its own money, the money of its constituent members, and we may be sure that the constituent members of any organisation will be very careful before they advance money to any other organisation either by way of loan or grant. In fact, he inveighed against dictatorship on my part, because I was enabling one organisation to lend another money. That is a totally new definition of the word "dictatorship." If the only dictatorship that we may fear from his hon. and learned Friend the Member for East Bristol (Sir S. Cripps) is a dictatorship of an enabling or empowering kind, we shall contemplate the future with much greater complacency.
He asked the specific question: would any action lie by one board against another by reason of the Bill? The answer is that no action will lie by one board against another by reason of the Bill. He said that under Clause 3 (3, b) there may be a danger of the rights of registered producers being taken away. But that paragraph deals with decisions which have been made under a Committee such as the tribunal which I have described already, and merely says that, when cases have been determined by such a tribunal and the decision has been agreed to by both parties, it should not be subject to any further discussion.

Mr. T. WILLIAMS: No reference is made to any tribunal whatever. The only reference is to a person proposing to make a grant or loan.

Mr. ELLIOT: The Paragraph, says a scheme may provide that, where such an agreement contains conditions requiring the board to act on the advice of any specified persons, the provisions of the scheme entitling a registered producer who is aggrieved by any act or omission of the board to refer the matter to arbitration shall not apply in relation to anything done, or omitted to be done, by the Board in pursuance of the agreement. The conditions laid down are agreed beforehand by the two parties to the transaction. If the board is to be bound in advance by the determination of an arbitral tribunal, I think that it is not unreasonable to stipulate in such cases that the matter should not be raised again. That is all that Clause 3 does.

Mr. T. WILLIAMS: Surely, the right hon. Gentleman will agree that should any person offer either a grant or a loan to the board and the board allow the person who makes the loan or offers the grant to specify the conditions under which the money shall be spent, then the rights of the registered producers are taken away?

Mr. ELLIOT: It is only if the registered producers agree. The board will represent the registered producers. It is the empowering of certain persons to act on behalf of their constituents. My hon. friend may think that it goes too far. In that case there is plenty of opportunity for any shareholders to call to account their directors who have exceeded their powers or entered into a transaction by which the shareholders, so to speak, have suffered loss. It is only in conditions where the two executives have agreed to such an amount that there can be any bargain on the part of the representatives of producers under the scheme.

Sir JOSEPH NALL: If the boards give guarantees, what is the security for those guarantees, and does the guarantee imply any sort of mortgage of the revenues of the board or of the shares or properties of the constituent members?

Mr. ELLIOT: The board can only give a guarantee against the security which is the collective credit of the board, and the collective credit of the board can only be made available by means of a levy on the members of the board entered into under the arrangement of the scheme.

Sir J. NALL: So that by that means the credit of the constituent members concerned with the board might be very severely prejudiced by the action of the board.

Mr. ELLIOT: The executive of the group may pledge, if it wishes, the credit of the constituents of the group. It is surely nothing unreasonable and not an unusual thing. It has already power to do that. It only means that it is also possible for it to do so in regard to the operations of another board if it sees fit so to do. We must allow the directors of such an organisation the credit of believing that they are able to judge of the usefulness or otherwise of the transactions of their constituent members. It is inevitable and implicit in the execution of such bargains. It has, at any
rate, since 1931, been in the power of all such boards to incur considerable liabilities in respect of their members, and it is in regard to their own operations and where the usefulness to their constituent members may at least be very great, that they are allowed to enter into commitments in regard to the operation of other powers as well.

Sir J. NALL: Constituent members have no control.

Mr. ELLIOT: I cannot discuss this matter by question and answer, but to say that constituent members have no control is really stretching the matter too far. If constituent members have no control, you might as well say that the constituents have no control over my hon. and gallant Friend on a matter of which they may strongly disapprove, such as the passing of the legislative measures of the Government. It is true that his constituents might take him by the scruff of the neck and drag him from the House of Commons. Members of the public in the constituencies have during the past exercised tremendous control over Members of this House, and no doubt will continue to do so.

Sir J. NALL: Can they have them turned out?

Mr. ELLIOT: I cannot enter into discussions of that nature, but it is very necessary for us to realise that this board is a responsible institution and unless it is going to live up to the height of its responsibilities the scheme will not succeed. We have already entrusted to it tremendous power, and to come here and call it objectionable because it has gone wrong in certain respects is, I submit, unreasonable. It has a responsibility analagous to that of our great railway systems. On Clause 5 my hon. Friend the Member for Don Valley asked from which fund the bacon curers are drawing money? The answer is that they are drawing money from no fund to-day, nor can they draw money from any fund until this Bill is on the Statute Book and the Treasury is empowered to make the necessary advances. I am also asked whether I contemplate that any large sum will be loaned. I can go no further than the Explanatory and Financial Memorandum, which says quite frankly:
It cannot now be stated how much money will become payable under this Clause.
As my hon. and right hon. Friends will realise, that depends upon the amount of loss incurred.

Sir PERCY HARRIS: A blank cheque.

Mr. ELLIOT: It is really not sensible of my hon. Friend to make comments of that nature. If he had been present at the earlier stages of the Debate, be would have heard many most meticulous safeguards which have been inserted into these financial provisions. I merely say that it is impossible to give a total figure, because a total figure can only be determined after the conclusion of the period during which this transaction occurs. We have been given an outside limit net greater than the outside limit contemplated under the Act of 1931, which, as I remember very well, my hon. Friend supported.
My hon. Friend asked what levy would be required. Again, I do not think that it is possible to give a figure, although a levy of a relatively small sum, such as 4d. per score, would certainly pay a very large amount of the loss on such a scheme as this. I was asked specifically to answer the point: Would a board outside Great Britain have power to limit output or sale of organised produce in this country? The answer is "No." A board has only power to control produce in its own area. If a scheme would clearly be broken up by imports into a board's area from a board producing outside, it would be necessary for it to negotiate with that board and come to a satisfactory agreement, as has already been done between the Scottish and English boards in the case of milk production, to make sure that the production of milk outside a board's area did not break up production inside that area which the board was organising.

Mr. T. WILLIAMS: I aim sorry to ask the right hon. Gentleman another question. Under Clause 6 (1, d) a home board is entitled
To exercise, as agents for the board administering any corresponding scheme, any power of that board
specifically referring to Northern Ireland legislation. Do we understand from the right hon. Gentleman that the English Bacon Marketing Board will act for production as well as for marketing on behalf of the Northern Ireland board?

Mr. ELLIOT: I answered that they can, when invited by the Northern Ireland board, act as agents for the Northern Ireland board in disposing of Northern Ireland produce, but they have not power to control the production in Northern Ireland. My hon. Friend the Member for North West Cornwall (Sir F. Acland), in his usual careful and perfectly fair analysis of the proposals of the Bill, dealt mainly with his apprehensions. He said that this was a new proposal, that it had aroused great suspicion among the producers; that it was a proposal which caused him the gravest apprehension. He then put one or two specific questions. There is nothing that would cause as much apprehension as the collapse of this scheme in its initial stages. The curers, like my right hon. Friend, had apprehensions when they were starting off on this tremendous new scheme and, quite legitimately, they said: "We must have some insurance about the scheme before we enter into it." The Producers Board, in the exercise of its own discretion, for its own purposes and for the benefit of its own members, said: "It is reasonable that some insurance should be entered into, and we will enter into arrangements with you in the form of an insurance." That was primarily for the benefit of the pig producers themselves. Nothing could have done greater damage to the producers than the failure of the scheme to go through when it had reached the stage, as all schemes reach the stage, when it was in the balance whether they should accept the scheme and go forward whole-heartedly to make it a success.
The right hon. Gentleman said that too much money was being advanced and that no such sums had been contemplated in the Act of 1931. I would ask him to consider his own instance. He said that it was only intended for initial expenses, a little stationery, a few office premises, and so on. Does he think that £625,000 is a reasonable sum to spend on a little stationery, a few postage stamps, a little office furniture, and so on?

Sir F. ACLAND: You would need to pay salaries for a whole year.

Mr. ELLIOT: I say that the —625,000 voted by Parliament in 1931 indicated that Parliament was contemplating initial expenses to be met far beyond
the payment of the small sums which my right hon. Friend has in mind. I say quite definitely that, although this actual emergency was not contemplated, because it had not arisen, Parliament envisaged formidable difficulties in the inception of the scheme and provided resources to cope with and overcome the formidable difficulties which might arise. The right hon. Gentleman spoke of the desirability, rather than accepting this scheme, of cutting contracts, of saying: "We will break a certain number of contracts and not complete them "; but he saw the tremendous administrative difficulties that would arise, except, he said, for the small man. Imagine going over contracts for 620,000 pigs and picking out contracts for the small man, and doing that within a week, or 10 days, or half a week. Obviously, the administrative muddle and chaos which would have supervened would far have exceeded any suspicion which would have been caused in the minds of the producers by putting the scheme through and carrying it through.
My right hon. Friend mentioned a joke that I made at Sadlers Wells Theatre. I apologise to him for having made the joke. I will not do it again. It also upset my hon. Friend the Member for Central Southwark (Mr. Horobin). He, who makes so many jokes himself, might have forgiven a little joke on my part. I beg him to consider with pity that little bantling of mine. I will do my utmost to refrain from any glimmer of humour in discussing any agricultural subject in the future. The hon. Member opposite said that the reason I was greeted with an enthusiastic "Yes "when speaking before the Council of Agriculture on restrictions was because I was speaking to a council of farmers. I suppose that the hon. Member knows Mr. George Dallas, a former respected Member of this House—he was in the Chair—and Mr. W. R. Smith, Parliamentary Secretary to the Board of Trade in the Socialist Government, he was also present, and Mr. Charles Roberts, not an unrespected member of his party. It was an audience of responsible men. I do not propose to follow the analysis of the general situation made again this evening by the hon. Member for Central Southwark. I am always interested in his analysis. I read it with interest when he delivered it on
a previous occasion, and I look forward with interest to hearing it again on a future occasion. When he began his preliminary mutterings in Committee upstairs my hon. Friend objected to any organisation for any purpose whatsoever, and much as I sympathise with him I cannot go with him the whole way.
The arguments used to-night have not been against the principle, except those of the hon. Member for Central Southwark. The arguments have stressed the necessity for careful administration, for a vigilant scrutiny to see that the moneys are not wasted, because while the loan comes from the Treasury the guarantee comes from the board, and it is our business in this House to administer carefully any fund in our charge and to see that the machinery which administers a fund supplied by others is capable of close and vigilant scrutiny. I hope that I have shown that this Board, which is to administer this fund, is capable of close scrutiny. All these are matters of administration; we accept the responsibility, and I am sure that we shall not be guilty of maladministration. The test is this: would it have been better if these arrangements had not been made, if those proposals, which the House sanctioned only last June, had been allowed to lapse through want of courage on the part of the Government. I am sure that there is only one answer. The House said, "Go forward, do your utmost to make these schemes a success. They are novel, but we are willing to try novelties. They involve administration, but

we will put up with administration. They may involve interference, but we realise that interference may be necessary." Having got that unanimous support from the House, and from 99 percent. of the producers and over 70 per cent. of the processors, if we had sat down nervously and let the situation founder because we were afraid to bring forward proposals which might raise criticism from my hon. Friend the Member for Central Southwark, or the right hon. Member for North Cornwall (Sir F. Acland), or the hon. Member for Gower, or the hon. Member for Don Valley, then these four gentlemen themselves would have been the first to condemn us, and that condemnation would have been echoed by every right hon. and hon. Gentleman in the House.

Sir F. ACLAND: Can the Minister deal with the small but important point which I raised? I refer to the apparent discrepancy between the Bill and the Financial Resolution. The Resolution refers to a different. Clause, to Clause 13 of the principal Act.

Mr. ELLIOT: That might be more properly raised on the Financial Resolution, but if my right hon. Friend wishes me to deal with it now I can do so in a sentence.

Sir F. ACLAND: I will leave it.



Question put, "That the word 'now' stand part of the Question."

The House divided: Ayes, 184; Noes, 44.

Division No. 13.]
AYES.
[11.7 p.m.


Acland-Troyte, Lieut.-Colonel
Cochrane, Commander Hon. A. D.
Fielden, Edward Brocklehurst


Adams, Samuel Vyvyan T. (Leeds, W.)
Colfox, Major William Philip
Fleming, Edward Lascelles


Agnew, Lieut.-Com. P. G.
Collins, Rt. Hon. Sir Godfrey
Fraser, Captain Ian


Albery, Irving James
Colman, N. C. D.
Fuller, Captain A. G.


Allen, Lt.-Col. Sir William (Armagh)
Conant, R. J. E.
Ganzoni, Sir John


Aske, Sir Robert William
Cook, Thomas A.
Gilmour, Lt.-Col. Rt. Hon. Sir John


Baldwin, Rt. Hon. Stanley
Copeland, Ida
Glossop, C. W. H.


Beaumont, Hon. R.E.B. (Portsrn'th,C.)
Courthope, Colonel Sir George L.
Goff, Sir Park


Benn, Sir Arthur Shirley
Craven-Ellis, William
Goldie, Noel B.


Birchall, Major Sir John Dearman
Crooke, J. Smedley
Goodman, Colonel Albert W.


Blindell, James
Crookshank, Capt. H. C. (Gainsb'ro)
Graham, Sir F. Fergus (C'mb'rl'd, N.)


Borodale, Viscount
Croom-Johnson, R. P.
Graves, Marjorie


Bossom, A. C.
Cruddas, Lieut.-Colonel Bernard
Grenfell, E. C. (City of London)


Boulton, W. W.
Denman, Hon. R. D.
Grimston, R. V.


Bower, Lieut.-Com. Robert Tatton
Dickie, John P.
Gritten, W. G. Howard


Braithwaite, J. G. (Hillsborough)
Drewe, Cedric
Guinness, Thomas L. E. B.


Broadbent, Colonel John
Dugdale, Captain Thomas Lionel
Hall, Capt. W. D'Arcy (Brecon)


Brocklebank, C. E. R.
Duggan, Hubert John
Hanley, Dennis A.


Brown, Ernest (Leith)
Duncan, James A. L. (Kensington, N.)
Heilgers, Captain F. F. A.


Brown, Brig.-Gen.H.C.(Berks.,Newb'y)
Edmondson, Major A. J.
Henderson, Sir Vivian L. (Cheimsf'd)


Browne, Captain A. C.
Elliot, Rt. Hon. Walter
Hore-Belisha, Leslie


Burgin, Dr. Edward Leslie
Elmley, Viscount
Hornby, Frank


Burnett, John George
Ernrys-Evans, P. V.
Horobin, Ian M.


Caporn, Arthur Cecil
Erskine-Bolst, Capt. C. C. (Blackpool)
Howitt, Dr. Alfred B.


Carver, Major William H.
Essenhigh, Reginald Clare
Hudson, Capt. A. U. M. (Hackney, N.)


Clayton, Sir Christopher
Evans, Capt. Arthur (Cardiff, S.)
Hume, Sir George Hopwood


Hunter, Dr. Joseph (Dumfries)
Munro, Patrick
Shaw, Captain William T. (Forfar)


Hunter-Weston, Lt.-Gen. Sir Aylmer
Nall-Cain, Hon. Ronald
Shepperson, Sir Ernest W.


Inskip, Rt. Hon. Sir Thomas W. H.
Nicholson, Godfrey (Morpeth)
Shute, Colonel J. J.


James, Wing.-Com. A. W. H.
Nunn, William
Skelton, Archibald Noel


Jennings, Roland
O'Donovan, Dr. William James
Smith, Bracewell (Dulwich)


Jesson, Major Thomas E.
Ormsby-Gore, Rt. Hon. William G. A.
Smith, R. W. (Ab'rd'n & Kinc'dlne, C.)


Joel, Dudley J. Barnato
Palmer, Francis Noel
Somervell, Sir Donald


Ker, J. Campbell
Pearson, William G.
Somerville, Annesley A (Windsor)


Law, Sir Alfred
Peat, Charles U.
Soper, Richard


Leckie, J. A.
Penny, Sir George
Sotheron-Estcourt, Captain T. E.


Leech, Dr. J. W.
Percy, Lord Eustace
Southby, Commander Archibald R. J.


Leighton, Major B. E. P.
Perkins, Walter R. D.
Spens, William Patrick


Lindsay, Noel Ker
Petherick, M.
Storey, Samuel


Llewellin, Major John J.
Peto, Geoffrey K. (W'verh'pt'n, Bilston)
Stourton, Hon. John J.


Loder, Captain J. de Vere
Pike, Cecil F.
Strauss, Edward A.


Lovat-Fraser, James Alexander
Procter, Major Henry Adam
Sueter, Rear-Admiral Murray F.


Lumley, Captain Lawrence R.
Pybus, Percy John
Sugden, Sir Wilfrid Hart


Mabane, William
Raikes, Henry V. A. M.
Tate, Mavis Constance


MacAndrew, Lieut.-Col. C. G. (Partick)
Ramsay, Capt. A. H. M. (Midlothian)
Thomson, Sir Frederick Charles


MacDonald, Rt. Hn. I. R. (Seaham)
Ramsay, T. B. W. (Western Isles)
Thorp, Linton Theodore


MacDonald, Malcolm (Bassetlaw)
Rankin, Robert
Todd, Capt. A. J. K. (B'wick-on-T.)


McKie, John Hamilton
Reed, Arthur C. (Exeter)
Tree, Ronald


McLean, Major Sir Alan
Reid, William Allan (Derby)
Wallace, John (Dunfermline)


McLean, Dr. W. H. (Tradeston)
Rhys, Hon. Charles Arthur U.
Ward, Irene Mary Bewick (Wallsend)


Magnay, Thomas
Rickards, George William
Wedderburn, Henry James Scrymgeour.


Manningham-Buller, Lt.-Col. Sir M.
Rosbotham, Sir Thomas
Wells, Sydney Richard


Margesson, Capt. Rt. Hon. H. D. R.
Ross Taylor, Waiter (Woodbridge)
Whiteside, Borras Noel H.


Martin, Thomas B.
Ruggles-Brise, Colonel E. A.
Whyte, Jardine Bell


Mayhew, Lieut.-Colonel John
Russell, Albert (Kirkcaldy)
Williams, Charles (Devon, Torquay)


Mills, Major J. D. (New Forest)
Russell, Hamer Field (Sheffield, B'tside)
Wills, Wilfrid D.


Milne, Charles
Salmon, Sir Isidore
Wilson, G. H. A. (Cambridge U.)


Molson, A. Hugh Elsdale
Salt, Edward W.
Windsor-Clive, Lieut.-Colonel George


Moore, Lt.-Col. Thomas C. R. (Ayr)
Sandeman, Sir A. N. Stewart
Womersley, Walter James


Morris, Owen Temple (Cardiff, E.)
Sanderson, Sir Frank Barnard



Morrison, William Shepherd
Shakespeare, Geoffrey H.
TELLERS FOR THE AYES.—


Muirhead, Lieut.-Colonel A. J.
Shaw, Helen B. (Lanark, Bothwell)
Lord Erskine and Dr. Morris-Jones.


NOES.


Acland, Rt. Hon. Sir Francis Dyke
Foot, Isaac (Cornwall, Bodmin)
McGovern, John


Adams, D. M. (Poplar, South)
Greenwood, Rt. Hon. Arthur
Mainwaring, William Henry


Attlee, Clement Richard
Grenfell, David Rees (Glamorgan)
Mander, Geoffrey le M.


Banfield, John William
Griffith, F. Kingsley (Middlesbro', W.)
Parkinson, John Allen


Batey, Joseph
Groves, Thomas E.
Price, Gabriel


Bevan, Aneurin (Ebbw Vale)
Grundy, Thomas W.
Rea, Walter Russell


Brown, C. W. E. (Notts., Mansfield)
Hall, George H. (Merthyr Tydvil)
Salter, Dr. Alfred


Cape, Thomas
Harris, Sir Percy
Smith, Tom (Normanton)


Cripps, Sir Stafford
Holdsworth, Herbert
Tinker, John Joseph


Daggar, George
Janner, Barnett
Williams, Edward John (Ogmore)


Davies, David L. (Pontypridd)
John, William
Williams, Thomas (York, Don Valley)


Davies, Rhys John (Westhoughton)
Jones, Morgan (Caerphilly)
Wilmot, John


Dobbie, William
Lansbury, Rt. Hon. George



Edwards, Charles
Logan, David Gilbert
TELLERS FOR THE NOES.—


Evans, David Owen (Cardigan)
Lunn, William
Mr. D. Graham and Mr. G. Macdonald.


Foot, Dingle (Dundee)
McEntee, Valentine L.



Question put, and agreed to.

Bill committed to a Committee of the Whole House for Monday next.—[Captain Margesson.]

Orders of the Day — AGRICULTURAL MARKETING [MONEY].

Considered in Committee, under Standing Order No. 69.

[Captain BOURNE in the Chair].

Motion made, and Question proposed,
That, for the purpose of any Act of the present Session to make further provision with respect to the financial powers of boards administering schemes under the Agricultural Marketing Act, 1931, and with respect to the contents of such schemes, to extend the power to make loans to such
boards under Section thirteen of the said Act of 1931, and for purposes connected with the matters aforesaid, it is expedient to authorise the payment out of moneys provided by Parliament of the sums required to defray any increase, resulting from the operation of the said Act of the present Session, in the expenditure authorised by Sub-section (5) of Section eleven of the Agricultural Marketing Act, 1931, to be made out of moneys so provided."—[Kings Recommendation signified].—[Mr. Elliot.]

11.16 p.m.

Mr. ELLIOT: I rise to reply to a point made by my right hon. Friend the Member for North Cornwall (Sir F. Acland), who asked why the Clause in the Bill differed from the Financial Resolution. It is simply that in the Clause we deal with the operation of the boards. They operate under Section 13 of the Act of 1931. The
only place where the Treasury comes in is under Section 11 of the Act of 1931, and the House will see that it is only if a loan is not repaid that there will be any increased charge on the Exchequer. The Section dealing with loans which are not repaid is Section 11 of the Act of [931, and thus the House will see the reason for the discrepancy, to which my right hon. Friend rightly drew attention, between the terms of the Clause and the terms of the Financial Resolution.

11.17 p.m.

Sir P. HARRIS: I wish to express my thanks to the right hon. Gentleman and regret that my right hon. Friend the Member for North Cornwall (Sir F. Acland) was unfortunately called away, but I will convey the right hon. Gentleman's remarks to him.

11.18 p.m.

Sir J. NALL: I would like to put more formally the point upon which I made an interjection a little earlier. Although the Bill to which this Resolution relates limits the operation of the proposed loans and guarantees, is it proposed that the Exchequer under this Resolution and consequential administrative action will be responsible for the aggregate or any part of those loans and guarantees which may be unpaid by any of these boards? If so, is it not likely that once this precedent is set this loss, which has already been incurred by the Bacon Board, will be the forerunner of many others He said, a few days ago, that we may now have to deal with beef, which may mean very much bigger losses.
With regard to the Bacon Board, I suggest that it illustrates the grave risk which the House is running in backing the financial losses as the thing stands at present. Obviously, if production is increased in this country imports must be reduced from somewhere else, and that is the great flaw in the whole of these schemes. So far as finance is concerned it may well be the means of this House being called upon to make very considerable advances for meeting the losses incurred, due to the glut to which the Minister has referred on other occasions. The tragic fact is that in the period in which the Bacon Board made this loss of £500,000 the enhanced prices which have accrued owing to the action of the board put something like £4,000,000 of surplus
profits into the pockets of the Danes, increasing the adverse balance of our trade with Denmark without any corresponding advantage to the exporters of this country, and at the expense of the consumers in this country, as an hon. Member below i:ne remarks. There really must be some end to this kind of thing. In the Resolution the House is shouldering a responsibility of financial losses and guarantees, and I venture to say that the constituent producers have no control whatever over the activities of this board. There is no analogy between membership of this House and membership of the boards. We at least can be thrown out by our constituents next time, but the unfortunate producers cannot dismiss these boards.

Mr. ELLIOT: Why not? I cannot explain the whole of the Act of 1931 to my hon. Friend, but I can assure him it was all done in that year.

Sir J. NALL: The point I want to make is that the constituent producers to whom these boards are supposed to be responsible have no kind of control over the boards in the manner that electors have over Members of this House, or in the manner that company shareholders even have over the directors of a public company. These boards, except for the flimsy control exercised by the Minister—who may not always be my right hon. Friend, but somebody with entirely different views—can act in a manner that may very well embarrass the finances of the country to a considerable extent. Under this Resolution, and those for which it will be a precedent, we are undertaking a dangerous and, it may be, a disastrous financial liability, all because of this acceptable and desirable increase in the production of home-produced food, and because the Government have not had the courage to impose a corresponding reduction in the imports of our foreign competitors.

11.22 p.m.

Mr. C. WILLIAMS: I do not think I could take the line of my hon. Friend who has just spoken, but I would like to point out the very real fears of many of us who opposed the stupid Measure of 1931. There is a very real danger in this Resolution, for the Government are making further provision out of moneys provided by Parliament, and there is the possibility that the whole scheme may
break down and that the money will have to be paid. That ought to be made perfectly clear. I hope that these schemes will go through and be of great value in the future to our agricultural industry; I believe everyone hopes that; but it is right that some of us should occasionally point out that we see very real dangers in these schemes. The only reason why I vote for this Motion or for the Bill is because I am determined to give the Government every possible support in trying to get things done. We would rather see the Government fail than that they should sit down idly doing nothing, like a Socialist party. I am making these remarks, not because I wish in any way to criticise the Government, but because I want to support the Government. I do say, however, that there ought to be careful supervision by the Treasury over the whole of these proceedings. I am somewhat shocked in these days to find how very rarely we see a representative of the Treasury on the Front Bench on these occasions looking after the interests of the taxpayer.

11.24 p.m.

Mr. ELLIOT: I am sure that the House as a, whole will sympathise with the criticisms of the hon. Member for Torquay (Mr. C. Williams). It is true that we must watch very closely the inception of such schemes, and any liability that Parliament may incur with regard to them. We agree that a vigilant eye should be kept on such schemes, and I readily recognise my hon. Friend's final words, that the House would forgive the Government much, but not any somnolence in dealing with the critical nature of things as they are at present. I pass now to the extraordinary remarks just offered to the House by my hon. Friend the Member for the Hulme Division (Sir J. Nall). My hon. Friend, coming late into the Debate, to which I think he cannot have listened—

Sir J. NALL: I have been here all the evening.

Mr. ELLIOT: Then my hon. Friend has not done us the honour of listening.

Sir J. NALL: I gave way to you to reply.

Mr. ELLIOT: My hon. Friend has displayed a very casual acquaintance with the foundation Act of the whole of the
schemes which we are discussing. He made the statement that the producers had no means of getting rid of those boards, or, as I understood him, no power to prevent them being set up.

Sir J. NALL: I said they had no control in any way similar to the control that electors have over the Members of this House or that shareholders have over the directors of a company.

Mr. ELLIOT: Let. us examine that proposition. Did the hon. Member hear me say how the Pig Board or the Bacon Board was brought into existence 7 He did hear me. He must have heard me say that they had been brought into existence by a, vote of 99 per cent. of registered producers.

Mr. HOLDSWORTH: Is it not a fact that they had to agree to that or they could not sell under the scheme?

Mr. ELLIOT: No, my hon. Friend should not be too rash in rushing to the rescue. I assure him it is not so. But I am dealing with my hon. Friend the Member for the Hulme division. He admits that the scheme was voluntarily set up by a majority of the producers. They did not need to set up the scheme. They had the power to bring it into force. Let me read to him a passage from an Act which describes the control which the producers have over the board that they set up. He will find it in Section 2 (1) of the Act of 1931 under which this scheme is now being brought forward:
Every scheme shall provide for the registration of any producer who makes application for that purpose and shall constitute a board to administer the scheme which shall, subject to the provisions of the scheme as to the filling of casual vacancies, be composed of representatives of registered producers elected by them in such manner as may be provided by the scheme.
Does he still maintain that they have not at least as much control over those representatives as cons auents have over Members elected to this House? If so, upon what does he base that contention?

Sir J. NALL: They have not the same means of getting rid of them.

Mr. ELLIOT: The control of representatives elected to this House is exercised on the occasions upon which those representatives proffer themselves for reelection. How often is that with the case of Members of this House? It may be a year, two years, three years, or up to the
full term of the Quinquennial Act: These proposals as regards the election of board members by the registered producers give annual elections—five times as often. How, then, does he substantiate his claim that their control is not as effective as that exercised by constituents over their representatives in Parliament? I have in my hand the Agricultural Marketing Act scheme regulating the marketing of pigs. It constitutes a, board and says:
thereafter the Board shall consist of eight district members elected one for each of the local districts specified in the First Schedule to this Scheme by the registered producers of that district, and three special members elected by the registered producers in general meeting. An election of district members for the South Western, South Eastern, Eastern and East Midland districts shall be held in the year 1934 and every second calendar year thereafter,
or every second year. Here is the scheme to which he objects. I have read the passage which provides for an election, subject to the provisions of the scheme, every second calendar year. Surely examination of the scheme does not bear out the statement that the registered producers have no control whatever. I do not wish to do more than clear up the point at issue between the two of us. The election of members every second calendar year makes it clear that the registered producers have control over the members of the board, a control which, it seems to us, they are capable of exercising.
One or two of the other propositions which were tendered to the committee by the hon. and gallant Gentleman did not seem to me to stand criticism any more than his original contention. He accused us at one and the same time of creating a large expansion in home production and of putting purchasing power into the pockets of the foreigner. He cannot have it both ways. It is impossible at one and the same time to maintain both those propositions. As far as I understood him, he regretted a large expansion of home production.

Sir J. NALL: No.

Mr. ELLIOT: Then I apologise to him He rejoices in this large expansion. He greets with pleasure, as we all do, this great expansion. He is fundamentally at one with us, then, in welcoming this scheme, and in supporting this Financial Resolution. All that he fears is that the
expansion may not be great enough to carry the risk in granting a loan.
Let him come with us joyfully into the Division Lobby. The greater the expansion of home production that can take place, the less will be the liability to the Treasury. A risk of £500,000 on a £5,000,000 contract is greater than a risk of £500,000 on a £15,000,000 contract. If we can expand home production to a point which will lower these risks, my hon. Friend's fears will be dissipated. The loan is made under this Act, and is made on the security of the board, and it would not be rashly or lightly made, because Section 13 lays it down that:
A loan under this Section shall not be renewed unless the renewal is recommended by the appropriate Agricultural Marketing Facilities Committee, and that committee shall not recommend the renewal unless they are satisfied that the board are in a position to repay the loan forthwith, that the renewal is required to provide for additional services which the board propose to undertake and that adequate arrangements have been, or will be, made to repay the loan at the expiration of the period for which it is to be renewed.
The position of the loan is safeguarded as far as it is statutorily possible to safeguard it. It is true that there is a risk; there is always a risk in lending money. This country has lost money in vast sums abroad; cannot we trust our own people a little and develop our own country? Does it not mean expanding home production here, and giving the same facilities to our own country as have been extended to other countries? That is the proposal we put before the House. I hope that those words of explanation will make it possible for the hon. and gallant Member to follow us into the Division Lobby, if the Committee are so ill-advised as to divide upon the Resolution.

Resolution to be reported upon Monday next.

The remaining Orders were read, and postponed.

It being after Half-past Eleven of the Clock, Mr. DEPUTY-SPEAKER  adjourned the House, without Question put, pursuant to the Standing Order.

Adjourned at Twenty-four Minutes before Twelve o'Clock.